6-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
under the Securities Exchange Act of 1934

For the Month of September 2023

CAMTEK LTD.
(Translation of Registrant’s Name into English)

Ramat Gavriel Industrial Zone
P.O. Box 544
Migdal Haemek 23150
ISRAEL
(Address of Principal Corporate Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒    Form 40-F ☐

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities and Exchange Act of 1934.

Yes ☐    No ☒

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. This Form 6-K, including all exhibits hereto, is hereby incorporated by reference into all effective registration statements filed by the registrant under the Securities Act of 1933.

CAMTEK LTD.
(Registrant)
 
By: /s/ Moshe Eisenberg
——————————————
Moshe Eisenberg,
Chief Financial Officer

Dated: September 27, 2023
 

Exhibit Number	Description of Exhibit
99.1	Unaudited interim condensed consolidated financial statements as of June 30, 2023.
99.2	Operating and Financial Review and Prospects.
101	The following financial information from Camtek Ltd.’s Report on Form 6-K, formatted in XBRL (eXtensible Business Reporting Language): (i) Unaudited interim condensed consolidated balance sheets on June 30, 2023 and December 31, 2022; (ii) Unaudited interim condensed consolidated statements of operations for the six months ended June 30, 2023 and 2022 and the year ended December 31, 2022; (iii) Unaudited interim condensed consolidated statements of changes in shareholders’ equity for the six months ended June 30, 2023 and 2022 and the year ended December 31, 2022; (iv) Unaudited interim condensed consolidated statements of cash flows for the six months ended June 30, 2023 and 2022 and the year ended December 31, 2022; and (v) notes to the Unaudited interim condensed consolidated financial statements.

EX-99.1

Exhibit 99.1

Camtek Ltd.

and its Subsidiaries

Interim Condensed Consolidated

Financial Statements

As of June 30, 2023

(Unaudited)

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Financial Statements as at June 30, 2023

Contents

	Page
Interim Unaudited Condensed Consolidated Balance Sheets	F-3
Interim Unaudited Condensed Consolidated Statements of Operations	F-4 to F-5
Interim Unaudited Condensed Consolidated Statements of Shareholders’ Equity	F-6
Interim Unaudited Condensed Consolidated Statements of Cash Flows	F-7 to F-8
Notes to the Interim Unaudited Condensed Consolidated Financial Statements	F-9 to F-16

F - 2

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Balance Sheets

		June 30,			December 31,
		2023			2022
	Note	U.S. Dollars (in thousands)
Assets
Current assets
Cash and cash equivalents	4A		232,787			148,156
Short-term deposits			198,500			251,500
Trade accounts receivable			79,025			80,611
Inventories	4B		61,207			65,541
Other current assets	4C		14,998			11,156
Total current assets			586,517			556,964
Long term deposits			75,000			79,000
Long term inventory	4B		7,125			5,357
Deferred tax assets			724			1,004
Other assets			2,557			1,024
Property, plant and equipment, net	4D		37,131			33,141
Intangible assets, net	4E		602			597
Total non-current assets			123,139			120,123
Total assets			709,656			677,087
Liabilities and shareholders’ equity
Current liabilities
Trade accounts payable			31,238			31,667
Other current liabilities	4F		45,529			56,833
Total current liabilities			76,767			88,500
Long term liabilities
Other long-term liabilities			10,198			8,748
Convertible notes	4G		196,284			195,737
			206,482			204,485
Total liabilities			283,249			292,985
Shareholders’ equity
Ordinary shares NIS 0.01 par value, 100,000,000 shares authorized at June 30, 2023 and at December 31, 2022;
46,811,504 issued shares at June 30, 2023 and 46,505,318 at December 31, 2022;
44,719,128 shares outstanding at June 30, 2023 and 44,412,942 at December 31, 2022;	3		175			175
Additional paid-in capital			193,626			187,105
Retained earnings			234,504			198,720
			428,305			386,000
Treasury stock, at cost (2,092,376 shares as of June 30, 2023 and December 31, 2022)			(1,898	)		(1,898	)
Total shareholders' equity			426,407			384,102
Total liabilities and shareholders' equity			709,656			677,087

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

F - 3

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Statements of Operations

(In thousands, except per share data)

		Six months ended June 30,						Year ended December 31,
		2023			2022			2022
	Note	U.S. dollars						U.S. dollars
Revenues			146,215			156,744			320,909
Cost of revenues			77,378			76,693			161,053
Gross profit			68,837			80,051			159,856
Research and development costs			15,672			15,199			28,859
Selling, general and  administrative expenses	5A		24,037			24,451			49,499
			39,709			39,650			78,358
Operating income			29,128			40,401			81,498
Financial income, net	5B		10,864			860			6,690
Income before income taxes			39,992			41,261			88,188
Income tax expense			(4,208	)		(3,700	)		(8,239	)
Net income			35,784			37,561			79,949

F - 4

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Statements of Operations (contd.)

Net income per ordinary share:

		Six months ended June 30,				Year ended December 31,
		2023		2022		2022
	Note	U.S. dollars				U.S. dollars
Basic net earnings per share			0.80		0.86		1.81
Diluted net earnings per share			0.74		0.78		1.66
Weighted average number of ordinary shares outstanding   (in thousands):
Basic			44,562		43,929		44,158
Diluted			48,531		48,150		48,229

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

F - 5

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Statements of Shareholders’ Equity

	Ordinary Shares				Number of						Additional				Total
	NIS 0.01 par value				Treasury			Treasury			paid-in		Retained		shareholders'
	Number of		U.S. Dollars		Shares			Shares			earnings		earnings		equity
	Shares Issued		(in thousands)					U.S. Dollars (in thousands)
Balances at
December 31, 2021		45,939,019		172		(2,092,376	)		(1,898	)		176,582		118,771		293,627
Share-based
compensation
expense		-		-		-			-			5,592		-		5,592
Exercise of share
options and RSUs		416,840		2		-			-			-		-		2
Net income		-		-		-			-			-		37,561		37,561
Balances at
June 30, 2022		46,355,859		174		(2,092,376	)		(1,898	)		182,174		156,332		336,782
Share-based
compensation
expense		-		-		-			-			4,931		-		4,931
Exercise of share
options and RSUs		149,459		1		-			-			-		-		1
Net income		-		-		-			-			-		42,388		42,388
Balances at
December 31, 2022		46,505,318		175		(2,092,376	)		(1,898	)		187,105		198,720		384,102
Share-based
compensation
expense		-		-		-			-			6,521		-		6,521
Exercise of share
options and RSUs		306,186		*		-			-			-		-		-
Net income		-		-		-			-			-		35,784		35,784
Balances at
June 30, 2023		46,811,504		175		(2,092,376	)		(1,898	)		193,626		234,504		426,407

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

*Represents an amount less than $1,000

F - 6

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Statements of Cash Flows

(In thousands)

	Six months ended June 30,						Year ended December 31,
	2023			2022			2022
	U.S. dollars						U.S. dollars
Cash flows from operating activities:
Net income		35,784			37,561			79,949
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization		2,406			1,849			4,094
Deferred tax expense		280			110			(777	)
Amortization of debt issuance costs		547			547			1,094
Loss on disposal of fixed assets		233			-			-
Share based compensation expense		6,521			5,592			10,523
Change in provision for doubtful debts		-			-			(7	)
Changes in operating assets and liabilities:
Trade accounts receivable		1,829			(14,252	)		(21,984	)
Inventories		171			(13,512	)		(9,518	)
Due from related parties		-			(2	)		-
Other assets		(5,375	)		(2,079	)		(6,337	)
Trade accounts payable		(231	)		1,244			(2,113	)
Other current liabilities		(9,449	)		(4,111	)		2,875
Net cash provided by operating activities		32,716			12,947			57,799
Cash flows from investing activities:
Redemption (investment) of short-term deposits		57,000			(179,000	)		(95,500	)
Investment of long-term deposits		-			(15,000	)		(47,000	)
Purchase of fixed assets		(4,782	)		(3,786	)		(8,197	)
Purchase of intangible assets		(60	)		(28	)		(97	)
Net cash provided by (used in) investing activities		52,158			(197,814	)		(150,794	)

Cash flows from financing activities:
Proceeds from exercise of share options	-		2		3
Net cash provided by financing activities	-		2		3
Effect of change in exchange rate on cash and cash equivalents	(243	)	(1,037	)	(795	)
Net increase (decrease) in cash and cash equivalents	84,631		(185,902	)	(93,787	)
Cash and cash equivalents at beginning of the period	148,156		241,943		241,943
Cash and cash equivalents at end of the period	232,787		56,041		148,156

F - 7

Camtek Ltd. and its Subsidiaries

Interim Unaudited Condensed Consolidated Statements of Cash Flows

(In thousands)

 

	Six months ended June 30,				Year ended December 31,
	2023		2022		2022
	U.S. dollars				U.S. dollars
Supplementary cash flows information:
Income taxes paid		9,626		454		11,836
Interest received		6,911		1,030		4,293
Lease payments		735		689		1,480
Non-cash transactions:
Fixed assets purchased with supplier credit		371		680		569

The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

F - 8

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 1 - Nature of Operations

A. Camtek Ltd. (“Camtek” or the “Company”), an Israeli corporation, is jointly controlled 21.5% by Priortech Ltd., an Israeli corporation listed on the Tel-Aviv Stock Exchange and 17.5% by Chroma Ate Inc., a Taiwanese company (“Chroma”). Camtek provides automated and technologically advanced solutions dedicated to enhancing production processes, increasing product yield and reliability, and enabling and supporting customers’ latest technologies in the semiconductor fabrication industry.

F - 9

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 2 - Basis of Preparation

A.          Statement of compliance

Except as described below, the accounting policies applied in these interim financial statements are the same as those applied in the Company’s 2022 annual audited consolidated financial statement for the year ended December 31, 2022.

The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and do not include all of the information required for full annual financial statements. The unaudited condensed consolidated interim statements should be read in conjunction with the Company’s 2022 annual audited consolidated financial statements and footnotes, which were filed with the U.S. Securities and Exchange Commission as part of the Company’s Annual Report on Form 20-F for the year ended December 31, 2022.

In the opinion of management of the Company, the accompanying unaudited condensed financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2023, and its results of operations for the three months and nine months ended June 30, 2023, and 2022, and cash flows for the six months ended June 30, 2023, and 2022. The condensed balance sheet at December 31, 2022, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

F - 10

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 3 - Shareholders’ Equity

A.          General

The Company’s shares are traded on the NASDAQ Global Market under the symbol “CAMT”, and also listed and traded on the Tel-Aviv stock exchange

B.          Changes in Stock Options and RSUs

The number of stock options exercised in the six-month period ended June 30, 2023, was 306,186.

In the first six months of 2023, 509,231 restricted share units (RSUs) were granted by the Company. The RSUs vest over a four-year period.

C.          Share-based Compensation Expense

The total share-based compensation expense amounted to $6,521, $5,592, and $10,523 for the six-month periods ended June 30, 2023 and 2022 and the year ended December 31, 2022, respectively.

F - 11

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 4 - Supplementary Financial Statements Information

A.          Cash and cash equivalents

The Company’s cash and cash equivalent balance at June 30, 2023 and December 31, 2022 is denominated in the following currencies:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
US Dollars		226,172		139,644
New Israeli Shekels		4,416		4,008
Other currencies		2,199		4,504
		232,787		148,156

Short-term deposits are bank deposits in US Dollars with terms at the investment date of 3-12 months with average annual interest rates of 5.05%.

B.          Inventories
 

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Components		34,158		43,017
Work in process		15,444		13,951
Finished products (including systems at customer locations not yet sold)		18,730		13,930
		68,332		70,898

Inventories are presented in:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Current assets		61,207		65,541
Long-term assets		7,125		5,357
		68,332		70,898

 

F - 12

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 4 - Supplementary Financial Statements Information (cont’d)

C.          Other Current Assets

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Interest receivable		7,048		3,979
Prepaid expenses		4,315		3,832
Due from Government institutions		2,875		2,598
Other		760		747
		14,998		11,156

D.          Property, Plant and Equipment, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Land		863		863
Building		20,345		18,490
Machinery and equipment		22,590		19,121
Office furniture and equipment		997		934
Computer equipment and software		6,218		6,256
Automobiles		396		396
Leasehold improvements		2,080		1,894
Right of use assets		5,845		6,087
		59,334		54,041
Less accumulated depreciation		22,203		20,900
		37,131		33,141

F - 13

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 4 - Supplementary Financial Statements Information (cont’d)

E.          Intangible Assets, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Patent registration costs		2,195		2,135
Accumulated amortization and impairment		1,593		1,538
Total intangible assets, net		602		597

F.          Other Current Liabilities

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Commissions		18,789		18,048
Advances from customers and deferred revenues		7,199		12,825
Accrued employee compensation and related benefits		10,506		11,941
Accrued warranty costs (1)		3,041		3,161
Government institutions and income tax payable		2,844		7,991
Accrued expenses		1,884		1,570
Operating lease obligations		1,266		1,297
		45,529		56,833

(1)          Changes in the accrued warranty costs are as follows:

	June 30,			December 31,
	2023			2022
	U.S. Dollars (in thousands)
Beginning of year		3,161			3,265
Accruals		2,721			5,823
Usage		(2,841	)		(5,927	)
Balance at end of year		3,041			3,161

F - 14

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 4 - Supplementary Financial Statements Information (cont’d)

G.          Convertible Notes

The Convertible Senior Notes consisted of the following:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Liability:
Principle:		200,000		200,000
Unamortized issuance costs		3,716		4,263
Net carrying amount		196,284		195,737

As of June 30, 2023, the debt issuance costs of the Notes will be amortized over the remaining term of approximately 3.5 years.

The annual effective interest rate of the Notes is 0.56%. In the six-months ended June 30, 2023, $547 was recorded as amortization of debt issuance costs (In the year ended December 31, 2022 - $1,094).

As of June 30, 2023, the estimated fair value of the Notes, which the Company has classified as Level 2 financial instruments, is $179,154 (December 31, 2022 - $152,565). The estimated fair value was determined based on the quoted bid price of the Notes in an over-the-counter market on the last trading day of the reporting period.

As of June 30, 2023, the principal amount exceeded the if-converted value of the Notes by $20,846 (December 31, 2022, the principal amount exceeded the if-converted value of the Notes by $47,435).

F - 15

Camtek Ltd. and its Subsidiaries

Notes to the Interim Unaudited Condensed Consolidated Financial Statements

(Amounts in thousands, except per share data)

Note 5 - Statements of Operations

A. Selling, general and administrative expenses

	Six months ended June 30,				Year ended December 31,
	2023		2022		2022
	U.S. Dollars (in thousands)
Selling (1)		17,910		18,840		38,249
General and administrative		6,127		5,611		11,250
		24,037		24,451		49,499
(1)         Including shipping and handling costs		1,025		980		2,294

B.          Financial income (expenses), net

	Six months ended June 30,						Year ended December 31,
	2023			2022			2022
	U.S. Dollars (in thousands)
Interest income		11,838			2,488			8,648
Amortization of issuance costs of convertible notes		(547	)		(547	)		(1,094	)
Other, net (1)		(427	)		(1,081	)		(864	)
		10,864			860			6,690
(1)         Including foreign currency expense resulting from transactions not denominated in U.S. Dollars		(172	)		(871	)		(351	)

Note 6 – Subsequent Events

On September 18, 2023, the Company announced it has entered into an agreement to acquire the FRT Metrology business of FormFactor, Inc. The acquisition is expected to close during the fourth quarter of 2023, subject to the satisfaction of customary closing conditions. The purchase price is $100 million in cash, subject to customary purchase price adjustments.

F - 16

EX-99.2

Exhibit 99.2

Operating and Financial Review and Prospects.

A. Operating Results

General

The following discussion of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the notes to those statements included therein, which have been prepared in accordance with accounting principles generally accepted in the United States, or U.S. GAAP.

Overview

We design, develop, manufacture and market automated solutions dedicated for enhancing production processes and yield for the semiconductor fabrication market, principally based on core AOI technology.

We sell our systems worldwide. The vast majority of our sales are to manufacturers in the Asia Pacific region, including China, South East Asia, Korea and Taiwan, due to, among other factors, the migration of the electronic manufacturers into this region.

In the first half of 2023, our sales to customers in the Asia Pacific region accounted for approximately 86% of our total revenues with sales to China being 55% of our total revenues.

In addition to revenues derived from the sale of systems and related products, we generate revenues from providing maintenance and support services for our products. We generally provide a one-year warranty with our systems. Accordingly, service revenues are not earned during the warranty period.

Critical Accounting Policies

Critical accounting policies are those that are, in management’s view, most important to the portrayal of a company’s financial condition and results of operations and most demanding judgment calls, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. We believe our most critical accounting policies relate to:

Revenue Recognition. The Company’s contracts with its customers include performance obligations to provide its products or to service the installed products. A product sale contract may include an extended warranty (that is, for longer than the twelve-month standard warranty) as well as installation, both of which are considered separate performance obligations.

The Company recognizes revenue from contracts for sales of products when the Company transfers control of the product to the customer. This generally occurs upon shipment as pre-shipment calibration and testing processes ensure simplified and streamlined installation at the customer site. Revenues from the contract are recognized in an amount that reflects the consideration the Company expects to be entitled to receive once the product is operating in accordance with its specifications and signed documentation of the arrangement, such as a signed contract or purchase order, has been received. Payment terms with customers may vary, but are generally based on milestones within the delivery process such as shipping and installation. Payment terms do not include significant financing components.

The Company does not incur costs in obtaining a contract except for agents’ commissions, which are incurred upon the recognition of revenues. Revenues are recognized over a period of less than a year and as such, there are no underlying sales commissions to be capitalized.

Service revenues consist mainly of contracts charged under time and material arrangements. Service revenues from maintenance contracts are recognized ratably over the contract period.

Contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on the prices charged to customers.

The Company’s multiple performance obligations consist of product sales, installation services and non-standard warranties. A fixed amount is deferred in respect of installation services for machines that have been recognized but not installed as of the balance sheet date. A non-standard warranty is one that is for a period longer than 12 months. Accordingly, income from a non-standard warranty is deferred as unearned revenue and is recognized ratably as revenue commencing with and over the applicable warranty term.

The Company records contract liabilities when the customer has been billed in advance of the Company completing its performance obligations. These amounts are recorded as deferred revenue in the Consolidated Balance Sheets.

Valuation of Accounts Receivable.  We review accounts receivable to determine which are doubtful of collection. In making this determination of the appropriate allowance for doubtful accounts, we consider information at hand regarding specific customers, including aging of the receivable balance, evaluation of the security received from customers, our history of write-offs, relationships with our customers and the overall credit worthiness of our customers. Changes in the credit worthiness of our customers, the general economic environment and other factors may impact the level of our future write-offs.

Valuation of Inventory.  Inventories consist of completed systems, partially completed systems and components, and are recorded at the lower of cost, determined by the moving – average basis, or market. We review inventory for obsolescence and excess quantities to determine that items deemed obsolete or excess inventory are appropriately reserved. In making the determination, we consider forecasted future sales or service/maintenance of related products and the quantity of inventory at the balance sheet date, assessed against each inventory item’s past usage rates and future expected usage rates. Changes in factors such as technology, customer demand, competing products and other matters could affect the level of our obsolete and excess inventory in the future.

In the first half of 2023 there were no write-offs of inventory. In the year 2022 we wrote-off inventory in the amount of approximately $0.3 million. The write-off amounts are included in the line item called "Cost of products sold", in the consolidated statements of operations. The write-offs create a new cost basis and are a permanent reduction of inventory cost. The write-offs in in 2022 were made against damaged, obsolete, excess and slow-moving inventory. Inventory that is not expected to be converted or consumed in the following 12 months is classified as non-current. As of June 30, 2023, a $7.1 million portion of our inventory was classified as non-current. Management periodically evaluates our inventory composition, giving consideration to factors such as the probability and timing of anticipated usage and the physical condition of the items, and then estimates a charge (reducing the inventory) to be provided for slow moving, technologically obsolete or damaged inventory. These estimates could vary significantly from actual requirements based upon future economic conditions, customer inventory levels or competitive factors that were not foreseen or did not exist when the inventory write-offs were established.

Intangible assets. Patent registration costs are capitalized at cost and amortized, beginning with the first year of utilization, over its expected life of ten years.

We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the long lived asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as computed by subtracting the fair market value of the asset from its carrying value.

Provisions for contingent liabilities. A contingency (provision) in accordance with ASC Topic 450-10-05, Contingencies, is an existing condition or situation involving uncertainty as to the range of possible loss to the entity. A provision for claims is recognized if it is probable (likely to occur) that a liability has been incurred and the amount can be estimated reasonably. Provisions in general are highly judgmental, especially in cases of legal disputes. We assess the probability of an adverse event and if the probability is evaluated to be probable, we are required to fully provide for the total amount of the estimated contingent liability. We continually evaluate our pending provisions to determine if accruals are required. It is often difficult to accurately estimate the ultimate outcome of a contingent liability. Different variables can affect the timing and amount we provide for certain contingent liabilities. Our assessments are therefore subject to estimates made by us and our legal counsel, adverse revision in our estimates of the potential liability could materially impact our financial condition, results of operations or liquidity.

Valuation of Long Lived Assets. We apply ASC Subtopic 360-10, "Property, Plant and Equipment".  This Statement requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset.  If the carrying amount of the long lived asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized as computed by subtracting the fair market value of the asset from its carrying value. We prepare future cash flows based on our best estimates including projections and financial statements, future plans and growth estimates.

Income Taxes. We account for income taxes under ASC Subtopic 740-10 Income Taxes – Overall.  Deferred tax assets or liabilities are recognized in respect of temporary differences between the tax bases of assets and liabilities and their financial reporting amounts as well as in respect of tax losses and other deductions which may be deductible for tax purposes in future years, based on tax rates applicable to the periods in which such deferred taxes will be realized. The rates applied are those enacted in law as of June 30, 2023. In assessing the realizability of deferred tax assets, we consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and during which the carry-forwards are available. Valuation allowances are established when necessary to reduce deferred tax assets to the amount considered more likely than not to be realized.

Our financial statements include deferred tax assets, net, which are calculated according to the above methodology. If there is an unexpected critical deterioration in our operating results and forecasts, we would have to increase the valuation allowance with respect to those assets. We believe that it is more likely than not that those net deferred tax assets included in our financial statements will be realized in subsequent years.

Stock Option and Restricted Share Plans. We account for our employee stock-based compensation awards in accordance with ASC Topic 718, Compensation - Stock Compensation. ASC Topic 718 requires that all employee stock‑based compensation is recognized as a cost in the financial statements and that for equity-classified awards such cost is measured at the grant date fair value of the award. We estimate grant date fair value using the Black‑Scholes-Merton option‑pricing model. Forfeitures are recognized when they occur.    

Leases. On January 1, 2019, we adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02) using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after January 1, 2019 are presented under Topic 842.

The adoption did not impact our beginning retained earnings, or prior year consolidated statements of income and statements of cash flows.

Under Topic 842, we determine if an arrangement is a lease at inception. ROU assets and lease liabilities are recognized at commencement date based on the present value of remaining lease payments over the lease term. For this purpose, we consider only payments that are fixed and determinable at the time of commencement. As most of our leases do not provide an implicit rate, we use its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. Our incremental borrowing rate is a hypothetical rate based on its understanding of what our credit rating would be (7.0% in 2023). Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise such options. When determining the probability of exercising such options, we consider contract-based, asset-based, entity-based, and market-based factors. Lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the consolidated statements of income. Our lease agreements generally do not contain any residual value guarantees or restrictive covenants.

Operating lease ROU assets are presented as property, plant and equipment on the consolidated balance sheet. The current portion of operating lease liabilities is included in other current liabilities and the long-term portion is presented within long-term liabilities on the consolidated balance sheet.

For operating leases, the ROU asset is subsequently measured throughout the lease term at the carrying amount of the lease liability, plus initial direct costs, plus (minus) any prepaid (accrued) lease payments, less the unamortized balance of lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

ROU assets for operating leases are periodically reduced by impairment losses. We use the long-lived assets impairment guidance in ASC Subtopic 360-10, Property, Plant, and Equipment – Overall, to determine whether an ROU asset is impaired, and if so, the amount of the impairment loss to recognize.

Comparison of Period to Period Results of Operations

The following table presents consolidated statement of operations data for the periods indicated as a percentage of total revenues from continuing operations:

	Six Months Ended June 30,
	2023			2022
Revenues		100.0	%		100.0	%
Cost of revenues		52.9	%		48.9	%
Gross profit		47.1	%		51.1	%
Operating expenses:
Research and development, net		10.7	%		9.7	%
Selling, general and administrative expenses		16.4	%		15.6	%
Total operating expenses		27.2	%		25.3	%
Operating income		19.9	%		25.8	%
Financial income, net		7.4	%		0.5	%
Income tax (expenses) benefit		(2.9	)%		(2.4	)%
Net income		24.5	%		24.0	%

Six months Ended June 30, 2023 compared to Six months ended June 30, 2022

Revenues. Revenues decreased by 6.7% to $146.2 million in 2023 from $156.7 million in 2022. The increase is mainly due to the sale of a lower number of tools due to decreased demand in the semiconductor market.

Gross Profit. Gross profit consists of revenues less cost of revenues, which includes the cost of components, production materials, labor, service related expenses, depreciation, factory and overhead expenses and provisions for warranties. These expenditures are partially affected by sales volume. Our total gross profit decreased to $68.8 million in 2023 from $80.1 million in 2022, a decrease of $11.3 million, or 14%. Our gross margin reduced to 47.1% in 2023, compared to a gross margin of 51.1% in 2022.

Research and Development Costs. Research and development expenses consist primarily of salaries, materials consumption and costs associated with subcontracting certain development efforts. Total research and development expenses for 2023 increased to $15.7 million from $15.2 million in 2022 due to increased activity for improving capabilities and developing additional features and products.

Selling, General and Administrative Expenses. Selling, general and administrative expenses consist primarily of expenses associated with salaries, commissions, promotion and travel, professional services and rent costs. Our selling, general and administrative expenses decreased by 1.7% to $24.0 million in 2023 from $24.5 million in 2022, mainly due to a decrease in sales channels activity on decreased revenues.

Financial Income (Expenses), Net. Financial income/expenses consist of interest, revaluation and other bank fees. We had net financial income of $10.9 million in 2023, compared to net financial income of $0.9 million in 2022. These changes relate to interest income from higher interest rates on increased short- and long-term deposits, offset by losses from changes in the exchange rate.

Provision for Income Taxes. Income tax expense was $4.2 million in 2023 compared to expense of $3.7 million in 2022, mainly due to tax on increased financial income from increased cash and cash equivalents.

Net Income. We realized net income of $35.8 million in 2023 compared to net income of $37.6 million in 2022, in light of the factors discussed above.

B. Liquidity and Capital Resources

Our cash and cash equivalent and short-term deposit balances totalled approximately $431.3 million on June 30, 2023 and $399.7 million on December 31, 2022. In addition, there was $75 million and $79 million, respectively, in long-term deposits. Our cash is invested in bank deposits spread among several banks, primarily in Israel.

Our working capital was approximately $509.8 million at June 30, 2023 and $468.5 million at December 31, 2022. The increase is mainly attributed to the increase in cash and cash equivalents and the decrease in other current liabilities, offset by the decrease in short-term deposits.

Our capital expenditures during the first half of 2023 were approximately $4.8 million, mainly in support of our operating activities.

 

Cash flow from operating activities

Net cash and cash equivalents provided by operating activities for the six months ended June 30, 2023, totalled $32.7 million. Net cash and cash equivalents provided by operating activities for the six months ended June 30, 2022 totalled $12.9 million.

During the first half of 2023, cash provided by operating activities was primarily attributed to the positive net income and the increase in trade accounts receivable, offset by the increase in other current assets and the decrease in other current liabilities.

Cash flow from investing activities

Cash flow used in investing activities in the first half of 2023 was $52.2 million, primarily due to the redemption of short- and long-term deposits, compared to $197.8 million in the first half of 2022.

Cash flow from financing activities

 

Cash flow provided by financing activities the first half of 2023 and 2022 was zero.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2023
Document And Entity [Abstract]
Entity Registrant Name	CAMTEK LTD
Entity Central Index Key	0001109138
Current Fiscal Year End Date	--12-31
Document Type	6-K
Amendment Flag	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Entity Address, Address Line One	Ramat Gavriel Industrial Zone
Entity Address, Address Line Two	P.O. Box 544
Entity Address, Address Line Three	Migdal Haemek
Entity Address Country	IL
Entity Address, Postal Zip Code	23150

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Interim Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 232,787	$ 148,156
Short-term deposits	198,500	251,500
Trade accounts receivable	79,025	80,611
Inventories	61,207	65,541
Other current assets	14,998	11,156
Total current assets	586,517	556,964
Long term deposits	75,000	79,000
Long term inventory	7,125	5,357
Deferred tax assets	724	1,004
Other assets	2,557	1,024
Property, plant and equipment, net	37,131	33,141
Intangible assets, net	602	597
Total non-current assets	123,139	120,123
Total assets	709,656	677,087
Current liabilities
Trade accounts payable	31,238	31,667
Other current liabilities	45,529	56,833
Total current liabilities	76,767	88,500
Long term liabilities
Other long-term liabilities	10,198	8,748
Convertible notes	196,284	195,737
Total Non current liabilities	206,482	204,485
Total liabilities	283,249	292,985
Shareholders' equity
Ordinary shares NIS 0.01 par value, 100,000,000 shares authorized at June 30, 2023 and at December 31, 2022; 46,811,504 issued shares at June 30, 2023 and 46,505,318 at December 31, 2022; 44,719,128 shares outstanding at June 30, 2023 and 44,412,942 at December 31, 2022;	175	175
Additional paid-in capital	193,626	187,105
Retained earnings	234,504	198,720
Total shareholders' equity before treasury stock	428,305	386,000
Treasury stock, at cost (2,092,376 shares as of June 30, 2023 and December 31, 2022)	(1,898)	(1,898)
Total shareholders' equity	426,407	384,102
Total liabilities and shareholders' equity	$ 709,656	$ 677,087

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Interim Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - ₪ / shares	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common Stock, par value per share	₪ 0.01	₪ 0.01
Common Stock, shares authorized	100,000,000	100,000,000
Common Stock, shares issued	46,811,504	46,505,318
Common Stock, shares outstanding	44,719,128	44,412,942
Treasury Stock, Common, Shares	2,092,376	2,092,376

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Interim Unaudited Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Income Statement [Abstract]
Revenues	$ 146,215	$ 156,744	$ 320,909
Cost of revenues	77,378	76,693	161,053
Gross profit	68,837	80,051	159,856
Research and development costs	15,672	15,199	28,859
Selling, general and administrative expenses	24,037	24,451	49,499
Total operating expenses	39,709	39,650	78,358
Operating income	29,128	40,401	81,498
Financial income, net	10,864	860	6,690
Income before income taxes	39,992	41,261	88,188
Income tax expense	(4,208)	(3,700)	(8,239)
Net income	$ 35,784	$ 37,561	$ 79,949
Net income per ordinary share:
Basic net earnings per share	$ 0.8	$ 0.86	$ 1.81
Diluted net earnings per share	$ 0.74	$ 0.78	$ 1.66
Weighted average number of ordinary shares outstanding (in thousands):
Basic	44,562	43,929	44,158
Diluted	48,531	48,150	48,229

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Interim Unaudited Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Ordinary Shares NIS 0.01 par value [Member]		Treasury Shares [Member]	Additional paid-in earnings [Member]	Retained earnings [Member]	Total
Balance, value at Dec. 31, 2021	$ 172		$ (1,898)	$ 176,582	$ 118,771	$ 293,627
Balance, shares at Dec. 31, 2021	45,939,019		(2,092,376)
Share-based compensation expense	$ 0		$ 0	5,592	0	5,592
Exercise of share options and RSUs	$ 2		$ 0	0	0	2
Exercise of share options and RSUs, shares	416,840		0
Net income	$ 0		$ 0	0	37,561	37,561
Balance, value at Jun. 30, 2022	$ 174		$ (1,898)	182,174	156,332	336,782
Balance, shares at Jun. 30, 2022	46,355,859		(2,092,376)
Balance, value at Dec. 31, 2021	$ 172		$ (1,898)	176,582	118,771	293,627
Balance, shares at Dec. 31, 2021	45,939,019		(2,092,376)
Net income						79,949
Balance, value at Dec. 31, 2022	$ 175		$ (1,898)	187,105	198,720	$ 384,102
Balance, shares at Dec. 31, 2022	46,505,318		(2,092,376)			44,412,942
Balance, value at Jun. 30, 2022	$ 174		$ (1,898)	182,174	156,332	$ 336,782
Balance, shares at Jun. 30, 2022	46,355,859		(2,092,376)
Share-based compensation expense	$ 0		$ 0	4,931	0	4,931
Exercise of share options and RSUs	$ 1		$ 0	0	0	1
Exercise of share options and RSUs, shares	149,459		0
Net income	$ 0		$ 0	0	42,388	42,388
Balance, value at Dec. 31, 2022	$ 175		$ (1,898)	187,105	198,720	$ 384,102
Balance, shares at Dec. 31, 2022	46,505,318		(2,092,376)			44,412,942
Share-based compensation expense	$ 0		$ 0	6,521	0	$ 6,521
Exercise of share options and RSUs		[1]	$ 0	0	0	0
Exercise of share options and RSUs, shares	306,186		0
Net income	$ 0		$ 0	0	35,784	35,784
Balance, value at Jun. 30, 2023	$ 175		$ (1,898)	$ 193,626	$ 234,504	$ 426,407
Balance, shares at Jun. 30, 2023	46,811,504		(2,092,376)			44,719,128

[1] Represents an amount less than $1,000

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Interim Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Cash flows from operating activities:
Net income	$ 35,784	$ 37,561	$ 79,949
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	2,406	1,849	4,094
Deferred tax expense	280	110	(777)
Amortization of debt issuance costs	547	547	1,094
Loss on disposal of fixed assets	233	0	0
Share based compensation expense	6,521	5,592	10,523
Change in provision for doubtful debts	0	0	(7)
Changes in operating assets and liabilities:
Trade accounts receivable	1,829	(14,252)	(21,984)
Inventories	171	(13,512)	(9,518)
Due from related parties	0	(2)	0
Other assets	(5,375)	(2,079)	(6,337)
Trade accounts payable	(231)	1,244	(2,113)
Other current liabilities	(9,449)	(4,111)	2,875
Net cash provided by operating activities	32,716	12,947	57,799
Cash flows from investing activities:
Redemption (investment) of short-term deposits	57,000	(179,000)	(95,500)
Investment of long-term deposits	0	(15,000)	(47,000)
Purchase of fixed assets	(4,782)	(3,786)	(8,197)
Purchase of intangible assets	(60)	(28)	(97)
Net cash provided by (used in) investing activities	52,158	(197,814)	(150,794)
Cash flows from financing activities:
Proceeds from exercise of share options	0	2	3
Net cash provided by financing activities	0	2	3
Effect of change in exchange rate on cash and cash equivalents	(243)	(1,037)	(795)
Net increase (decrease) in cash and cash equivalents	84,631	(185,902)	(93,787)
Cash and cash equivalents at beginning of the period	148,156	241,943	241,943
Cash and cash equivalents at end of the period	232,787	56,041	148,156
Supplementary cash flows information:
Income taxes paid	9,626	454	11,836
Interest received	6,911	1,030	4,293
Lease payments	735	689	1,480
Non-cash transactions:
Fixed assets purchased with supplier credit	$ 371	$ 680	$ 569

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Nature of Operations

6 Months Ended

Jun. 30, 2023

Nature of Operations [Abstract]

Nature of Operations

Note 1 - Nature of Operations

A. Camtek Ltd. (“Camtek” or the “Company”), an Israeli corporation, is jointly controlled 21.5% by Priortech Ltd., an Israeli corporation listed on the Tel-Aviv Stock Exchange and 17.5% by Chroma Ate Inc., a Taiwanese company (“Chroma”). Camtek provides automated and technologically advanced solutions dedicated to enhancing production processes, increasing product yield and reliability, and enabling and supporting customers’ latest technologies in the semiconductor fabrication industry.

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Basis of Preparation

6 Months Ended

Jun. 30, 2023

Basis of Preparation [Abstract]

Basis of Preparation

Note 2 - Basis of Preparation

A.          Statement of compliance

Except as described below, the accounting policies applied in these interim financial statements are the same as those applied in the Company’s 2022 annual audited consolidated financial statement for the year ended December 31, 2022.

The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and do not include all of the information required for full annual financial statements. The unaudited condensed consolidated interim statements should be read in conjunction with the Company’s 2022 annual audited consolidated financial statements and footnotes, which were filed with the U.S. Securities and Exchange Commission as part of the Company’s Annual Report on Form 20-F for the year ended December 31, 2022.

In the opinion of management of the Company, the accompanying unaudited condensed financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2023, and its results of operations for the three months and nine months ended June 30, 2023, and 2022, and cash flows for the six months ended June 30, 2023, and 2022. The condensed balance sheet at December 31, 2022, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

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Shareholders' Equity

6 Months Ended

Jun. 30, 2023

Shareholders' Equity [Abstract]

Shareholders' Equity

Note 3 - Shareholders’ Equity

A.          General

The Company’s shares are traded on the NASDAQ Global Market under the symbol “CAMT”, and also listed and traded on the Tel-Aviv stock exchange

B.          Changes in Stock Options and RSUs

The number of stock options exercised in the six-month period ended June 30, 2023, was 306,186.

In the first six months of 2023, 509,231 restricted share units (RSUs) were granted by the Company. The RSUs vest over a four-year period.

C.          Share-based Compensation Expense

The total share-based compensation expense amounted to $6,521, $5,592, and $10,523 for the six-month periods ended June 30, 2023 and 2022 and the year ended December 31, 2022, respectively.

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Supplementary Financial Statements Information

6 Months Ended

Jun. 30, 2023

Supplemantary Financial Statements Information [Abstract]

Supplementary Financial Statements Information

Note 4 - Supplementary Financial Statements Information

A.          Cash and cash equivalents

The Company’s cash and cash equivalent balance at June 30, 2023 and December 31, 2022 is denominated in the following currencies:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
US Dollars		226,172		139,644
New Israeli Shekels		4,416		4,008
Other currencies		2,199		4,504
		232,787		148,156

Short-term deposits are bank deposits in US Dollars with terms at the investment date of 3-12 months with average annual interest rates of 5.05%.

B.          Inventories
 

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Components		34,158		43,017
Work in process		15,444		13,951
Finished products (including systems at customer locations not yet sold)		18,730		13,930
		68,332		70,898

Inventories are presented in:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Current assets		61,207		65,541
Long-term assets		7,125		5,357
		68,332		70,898

C.          Other Current Assets

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Interest receivable		7,048		3,979
Prepaid expenses		4,315		3,832
Due from Government institutions		2,875		2,598
Other		760		747
		14,998		11,156

D.          Property, Plant and Equipment, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Land		863		863
Building		20,345		18,490
Machinery and equipment		22,590		19,121
Office furniture and equipment		997		934
Computer equipment and software		6,218		6,256
Automobiles		396		396
Leasehold improvements		2,080		1,894
Right of use assets		5,845		6,087
		59,334		54,041
Less accumulated depreciation		22,203		20,900
		37,131		33,141

E.          Intangible Assets, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Patent registration costs		2,195		2,135
Accumulated amortization and impairment		1,593		1,538
Total intangible assets, net		602		597

F.          Other Current Liabilities

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Commissions		18,789		18,048
Advances from customers and deferred revenues		7,199		12,825
Accrued employee compensation and related benefits		10,506		11,941
Accrued warranty costs (1)		3,041		3,161
Government institutions and income tax payable		2,844		7,991
Accrued expenses		1,884		1,570
Operating lease obligations		1,266		1,297
		45,529		56,833

(1)          Changes in the accrued warranty costs are as follows:

	June 30,			December 31,
	2023			2022
	U.S. Dollars (in thousands)
Beginning of year		3,161			3,265
Accruals		2,721			5,823
Usage		(2,841	)		(5,927	)
Balance at end of year		3,041			3,161

G.          Convertible Notes

The Convertible Senior Notes consisted of the following:

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Liability:
Principle:		200,000		200,000
Unamortized issuance costs		3,716		4,263
Net carrying amount		196,284		195,737

As of June 30, 2023, the debt issuance costs of the Notes will be amortized over the remaining term of approximately 3.5 years.

The annual effective interest rate of the Notes is 0.56%. In the six-months ended June 30, 2023, $547 was recorded as amortization of debt issuance costs (In the year ended December 31, 2022 - $1,094).

As of June 30, 2023, the estimated fair value of the Notes, which the Company has classified as Level 2 financial instruments, is $179,154 (December 31, 2022 - $152,565). The estimated fair value was determined based on the quoted bid price of the Notes in an over-the-counter market on the last trading day of the reporting period.

As of June 30, 2023, the principal amount exceeded the if-converted value of the Notes by $20,846 (December 31, 2022, the principal amount exceeded the if-converted value of the Notes by $47,435).

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Statements of Operations

6 Months Ended

Jun. 30, 2023

Income Statement Related Disclosures [Abstract]

Statements of Operations

Note 5 - Statements of Operations

A. Selling, general and administrative expenses

	Six months ended June 30,				Year ended December 31,
	2023		2022		2022
	U.S. Dollars (in thousands)
Selling (1)		17,910		18,840		38,249
General and administrative		6,127		5,611		11,250
		24,037		24,451		49,499
(1)         Including shipping and handling costs		1,025		980		2,294

B.          Financial income (expenses), net

	Six months ended June 30,						Year ended December 31,
	2023			2022			2022
	U.S. Dollars (in thousands)
Interest income		11,838			2,488			8,648
Amortization of issuance costs of convertible notes		(547	)		(547	)		(1,094	)
Other, net (1)		(427	)		(1,081	)		(864	)
		10,864			860			6,690
(1)         Including foreign currency expense resulting from transactions not denominated in U.S. Dollars		(172	)		(871	)		(351	)

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Subsequent Events

6 Months Ended

Jun. 30, 2023

Subsequent Events [Abstract]

Subsequent Events

Note 6 – Subsequent Events

On September 18, 2023, the Company announced it has entered into an agreement to acquire the FRT Metrology business of FormFactor, Inc. The acquisition is expected to close during the fourth quarter of 2023, subject to the satisfaction of customary closing conditions. The purchase price is $100 million in cash, subject to customary purchase price adjustments.

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Basis of Preparation (Policies)

6 Months Ended

Jun. 30, 2023

Basis of Preparation [Abstract]

Statement of compliance

A.          Statement of compliance

Except as described below, the accounting policies applied in these interim financial statements are the same as those applied in the Company’s 2022 annual audited consolidated financial statement for the year ended December 31, 2022.

The accompanying unaudited condensed consolidated interim financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and do not include all of the information required for full annual financial statements. The unaudited condensed consolidated interim statements should be read in conjunction with the Company’s 2022 annual audited consolidated financial statements and footnotes, which were filed with the U.S. Securities and Exchange Commission as part of the Company’s Annual Report on Form 20-F for the year ended December 31, 2022.

In the opinion of management of the Company, the accompanying unaudited condensed financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of June 30, 2023, and its results of operations for the three months and nine months ended June 30, 2023, and 2022, and cash flows for the six months ended June 30, 2023, and 2022. The condensed balance sheet at December 31, 2022, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements.

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Supplementary Financial Statements Information (Tables)

6 Months Ended

Jun. 30, 2023

Cash and Cash Equivalents [Abstract]

Schedule of Cash and cash equivalents

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
US Dollars		226,172		139,644
New Israeli Shekels		4,416		4,008
Other currencies		2,199		4,504
		232,787		148,156

Schedule of Inventories

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Components		34,158		43,017
Work in process		15,444		13,951
Finished products (including systems at customer locations not yet sold)		18,730		13,930
		68,332		70,898

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Current assets		61,207		65,541
Long-term assets		7,125		5,357
		68,332		70,898

Schedule of Other Current Assets

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Interest receivable		7,048		3,979
Prepaid expenses		4,315		3,832
Due from Government institutions		2,875		2,598
Other		760		747
		14,998		11,156

Schedule of Property, Plant and Equipment, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Land		863		863
Building		20,345		18,490
Machinery and equipment		22,590		19,121
Office furniture and equipment		997		934
Computer equipment and software		6,218		6,256
Automobiles		396		396
Leasehold improvements		2,080		1,894
Right of use assets		5,845		6,087
		59,334		54,041
Less accumulated depreciation		22,203		20,900
		37,131		33,141

Schedule of Intangible Assets, Net

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Patent registration costs		2,195		2,135
Accumulated amortization and impairment		1,593		1,538
Total intangible assets, net		602		597

Schedule of Other Current Liabilities

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Commissions		18,789		18,048
Advances from customers and deferred revenues		7,199		12,825
Accrued employee compensation and related benefits		10,506		11,941
Accrued warranty costs (1)		3,041		3,161
Government institutions and income tax payable		2,844		7,991
Accrued expenses		1,884		1,570
Operating lease obligations		1,266		1,297
		45,529		56,833

Schedule of accrued warranty costs

	June 30,			December 31,
	2023			2022
	U.S. Dollars (in thousands)
Beginning of year		3,161			3,265
Accruals		2,721			5,823
Usage		(2,841	)		(5,927	)
Balance at end of year		3,041			3,161

Scheduled of convertible senior notes

	June 30,		December 31,
	2023		2022
	U.S. Dollars (in thousands)
Liability:
Principle:		200,000		200,000
Unamortized issuance costs		3,716		4,263
Net carrying amount		196,284		195,737

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Statements of Operations (Tables)

6 Months Ended

Jun. 30, 2023

Income Statement Related Disclosures [Abstract]

Schedule of Selected Selling, General and Administrative Expenses Data

	Six months ended June 30,				Year ended December 31,
	2023		2022		2022
	U.S. Dollars (in thousands)
Selling (1)		17,910		18,840		38,249
General and administrative		6,127		5,611		11,250
		24,037		24,451		49,499
(1)         Including shipping and handling costs		1,025		980		2,294

Schedule of Selected Financial Income (Expenses) Data

	Six months ended June 30,						Year ended December 31,
	2023			2022			2022
	U.S. Dollars (in thousands)
Interest income		11,838			2,488			8,648
Amortization of issuance costs of convertible notes		(547	)		(547	)		(1,094	)
Other, net (1)		(427	)		(1,081	)		(864	)
		10,864			860			6,690
(1)         Including foreign currency expense resulting from transactions not denominated in U.S. Dollars		(172	)		(871	)		(351	)

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Nature of Operations (Narrative) (Details)	Jun. 30, 2023
Priortech Ltd [Member]
Schedule of Equity Method Investments [Line Items]
Ownership percentage	21.50%
Chroma Ate Inc [Member]
Schedule of Equity Method Investments [Line Items]
Ownership percentage	17.50%

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Shareholders' Equity (Narrative) (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation expense	$ 6,521	$ 5,592	$ 10,523
Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock options granted	306,186
Restricted Stock Units (RSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock options granted	509,231
Vesting period	4 years

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Supplementary Financial Statements Information (Currencies) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 232,787	$ 148,156
US Dollars [Member]
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	226,172	139,644
New Israeli Shekels [Member]
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	4,416	4,008
Other Currencies [Member]
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 2,199	$ 4,504

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Supplementary Financial Statements Information (Inventories) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Components	$ 34,158	$ 43,017
Work in process	15,444	13,951
Finished products (including systems at customer locations not yet sold)	18,730	13,930
Total inventories	68,332	70,898
Current assets	61,207	65,541
Long-term assets	$ 7,125	$ 5,357

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Supplementary Financial Statements Information (Other Current Assets) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets
Interest receivable	$ 7,048	$ 3,979
Prepaid expenses	4,315	3,832
Due from Government institutions	2,875	2,598
Other	760	747
Other current assets	$ 14,998	$ 11,156

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Supplementary Financial Statements Information (Property, Plant and Equipment, Net) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 59,334	$ 54,041
Less accumulated depreciation	22,203	20,900
Fixed assets, net	37,131	33,141
Land [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	863	863
Building [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	20,345	18,490
Machinery and equipment [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	22,590	19,121
Office furniture and equipment [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	997	934
Computer equipment and software [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	6,218	6,256
Automobiles [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	396	396
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	2,080	1,894
Right of use assets [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Gross	$ 5,845	$ 6,087

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Supplementary Financial Statements Information (Intangible Assets, Net) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Patent registration costs	$ 2,195	$ 2,135
Accumulated amortization and impairment	1,593	1,538
Total intangible assets, net	$ 602	$ 597

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Supplementary Financial Statements Information (Other Current Liabilities) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Accounts Payable and Accrued Liabilities, Current [Abstract]
Commissions	$ 18,789	$ 18,048
Advances from customers and deferred revenues	7,199	12,825
Accrued employee compensation and related benefits	10,506	11,941
Accrued warranty costs	3,041	3,161	$ 3,161	$ 3,265
Government institutions and income tax payable	2,844	7,991
Accrued expenses	1,884	1,570
Operating lease obligations	1,266	1,297
Total other current liabilities	$ 45,529	$ 56,833

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Supplementary Financial Statements Information (Accrued warranty costs) (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Accounts Payable and Accrued Liabilities, Current [Abstract]
Beginning of year	$ 3,161	$ 3,265
Accruals	2,721	5,823
Usage	(2,841)	(5,927)
Balance at end of year	$ 3,041	$ 3,161

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Supplementary Financial Statements Information (Convertible Notes) (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net [Abstract]
Principle	$ 200,000	$ 200,000
Unamortized issuance costs	3,716	4,263
Net carrying amount	$ 196,284	$ 195,737

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Supplementary Financial Statements Information (Narrative) (Details) - USD ($) $ in Thousands	6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Debt Instrument [Line Items]
Term of debt issuance costs amortization	3 years 6 months
Debt interest rate	0.56%
Amortization of debt issuance costs	$ 547	$ 547	$ 1,094
Estimated fair value of the notes classified as Level 2 financial instruments	179,154		152,565
Exceeded principal amount	$ 20,846		$ 47,435

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Statements of Operations (Selling, general and administrative expenses) (Details) - USD ($) $ in Thousands		6 Months Ended		12 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Income Statement Related Disclosures [Abstract]
Selling	[1]	$ 17,910	$ 18,840	$ 38,249
General and administrative		6,127	5,611	11,250
Total selling, general and administrative expenses		24,037	24,451	49,499
Shipping and handling costs		$ 1,025	$ 980	$ 2,294

[1] Including shipping and handling costs

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Statements of Operations (Financial income (expenses), net) (Details) - USD ($) $ in Thousands		6 Months Ended		12 Months Ended
		Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Income Statement Related Disclosures [Abstract]
Interest income		$ 11,838	$ 2,488	$ 8,648
Amortization of issuance costs of convertible notes		(547)	(547)	(1,094)
Other, net	[1]	(427)	(1,081)	(864)
Financial income (expenses), net		10,864	860	6,690
Foreign currency expense		$ (172)	$ 871	$ (351)

[1] Including foreign currency expense resulting from transactions not denominated in U.S. Dollars

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Subsequent Events (Narrative) (Details) $ in Millions	1 Months Ended
	Sep. 18, 2023 USD ($)
Subsequent Event [Member] | FormFactor, Inc [Member]
Subsequent Event [Line Items]
Purchase price in cash	$ 100