Core Insights - Axcelis Technologies experienced a 10% increase in share price over the past week, driven by a bottom-line beat in its inaugural quarter of 2025 [1] Financial Performance - For the first quarter, Axcelis reported revenue of $192.6 million, a significant decline from over $252 million in the same period of 2024 [2] - Non-GAAP net income fell to $33.8 million ($1.04 per share) from $55.2 million in the previous year [2] - Analysts had anticipated higher revenue of $221.6 million and adjusted earnings of $1.00 per share, indicating a mixed quarter for the company [3] Future Outlook - The company provided optimistic guidance, projecting revenue of approximately $185 million and adjusted net income of $0.73 per share for the second quarter [5] - Analysts expect slightly higher revenue of over $189 million but lower adjusted profitability estimates of $0.50 per share [5] - The semiconductor industry is currently volatile, but the company is seen as capable of navigating challenges and potentially thriving [6]

Revenue Performance - For the three months ended March 31, 2025, total revenue decreased to $192.6 million, down 23.7% from $252.4 million in the same period of 2024[84]. - Product revenue was $182.8 million, representing 94.9% of total revenue, a decrease of 24.9% compared to $243.4 million in the prior year[85]. - Services revenue increased to $9.7 million, or 5.1% of total revenue, up 8.8% from $9.0 million in the same period of 2024[87]. - Systems revenue for the three months ended March 31, 2025, was $137.6 million, down from $195.5 million in the same period of 2024[88]. - The company’s ten largest customers accounted for 67.3% of total revenue for the three months ended March 31, 2025[78]. Profitability and Expenses - Gross profit margin for the three months ended March 31, 2025, was 46.1%, slightly up from 46.0% in the prior year[90]. - Research and development expenses rose to $27.1 million, accounting for 14.1% of revenue, an increase of 5.7% from $25.7 million in the same period of 2024[96]. - Operating expenses totaled $59.6 million, representing 31.0% of revenue, compared to 23.6% in the prior year[93]. - General and administrative expenses increased to $17.4 million for the three months ended March 31, 2025, up by $1.0 million or 5.8% from $16.4 million in the same period of 2024[100]. - Other income rose to $3.9 million for the three months ended March 31, 2025, compared to $2.5 million in the prior year, reflecting a $1.5 million increase primarily due to a decrease in net foreign exchange losses[102]. Taxation - The income tax provision decreased to $4.5 million for the three months ended March 31, 2025, down by $2.9 million or 39.2% from $7.4 million in the same period of 2024[103]. - The effective tax rate (ETR) for the three months ended March 31, 2025 was 13.6%, compared to 12.5% for the same period in 2024, primarily due to a decrease in pre-tax book income[104]. Cash Flow and Liquidity - As of March 31, 2025, the company had $184.0 million in unrestricted cash and cash equivalents and $403.1 million in short-term investments, indicating strong liquidity[105]. - Cash generated from operating activities was $39.8 million for the three months ended March 31, 2025, compared to $42.2 million in the same period of 2024[107]. - Investing activities generated cash of $40.5 million for the three months ended March 31, 2025, with $297.9 million related to maturities and sales of short-term investments[109]. - Financing activities resulted in cash usage of $20.1 million for the three months ended March 31, 2025, including $18.2 million for stock repurchases[110]. - The company believes its existing cash and cash equivalents will be sufficient to meet anticipated cash requirements for both the short- and long-term[111]. Market Environment - The geopolitical environment surrounding trade and tariffs did not have a meaningful impact on financial results during the reporting period[80]. - There have been no material changes to the quantitative information about market risk as of March 31, 2025[113].

Financial Data and Key Metrics Changes - The company reported Q1 2025 revenue of $193 million and earnings per diluted share of $0.88, both exceeding expectations, with non-GAAP earnings per share at $1.04 [6][19] - Bookings for the quarter were $110 million, reflecting a sequential increase compared to Q4 2024, resulting in a book-to-bill ratio of 0.8, the highest since Q4 2023 [7][19] - GAAP gross margins were 46.1%, exceeding the outlook of 40%, while non-GAAP gross margins were 46.4% [22][23] Business Line Data and Key Metrics Changes - Systems revenue was $138 million, and CS&I revenue was $55 million, both slightly above expectations [19] - Sales to mature node applications remained dominant, particularly in Power and General Mature segments [9] - Revenue from silicon carbide applications declined sequentially due to moderated customer investments, while engagement in technology transitions remained strong [10][11] Market Data and Key Metrics Changes - Revenue from China declined to 37% of total shift system sales, down from 49% in the prior quarter, with expectations for fluctuations in 2025 [19][20] - Shipments to the U.S. grew to 23% of total sales, while Korea improved to 20%, mainly due to increased DRAM shipments [19] - The company anticipates that China revenue will be lower year-over-year in 2025 compared to 2024, despite potential quarterly fluctuations [19][66] Company Strategy and Development Direction - The company is focused on innovation and cost control to capture long-term growth opportunities while mitigating tariff impacts [7][9] - Plans are in place to lessen the direct impact of tariffs, leveraging a diversified global supply chain [8][50] - The company aims to maintain strong profitability and invest in R&D to prepare for future market recovery [86][87] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term drivers of the semiconductor industry, despite current macroeconomic challenges [16][29] - The company expects revenue in Q2 2025 to be approximately $185 million, with non-GAAP gross margins around 42% [27] - Management noted that while the macroeconomic environment is uncertain, customer discussions indicate continued investments in technology roadmaps [27][28] Other Important Information - The company generated $35 million in free cash flow in Q1 2025 and exited the quarter with $587 million in cash and no debt [26] - A $100 million increase in share repurchase authorization reflects confidence in long-term business fundamentals [26] Q&A Session Summary Question: What contributed to the robust gross margin? - Management indicated that higher margin spare sales and favorable deferred revenue recognition contributed to the strong gross margin performance [33][35] Question: What is the order intensity for Q2? - Management noted that Q1 bookings reflected a good profile for future business, primarily from general mature and power segments [40][41] Question: Can you provide granularity on the margin performance? - The largest contributor to margin performance was the mix of sales, with expectations for moderation in the second quarter [44][47] Question: What is the outlook for China revenue? - Management anticipates that China revenue will be lower year-over-year in 2025, with fluctuations expected in quarterly performance [101][103] Question: What is the company's strategy regarding R&D spending? - The company plans to maintain R&D investments to capitalize on future market recovery and ensure readiness with innovative products [84][86]

Core Insights - Axcelis Technologies (ACLS) reported quarterly earnings of $1.04 per share, significantly exceeding the Zacks Consensus Estimate of $0.39 per share, although down from $1.57 per share a year ago, resulting in an earnings surprise of 166.67% [1] - The company achieved revenues of $192.56 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.29%, but down from $252.37 million year-over-year [2] - Axcelis has consistently surpassed consensus EPS estimates over the last four quarters [2] Earnings Outlook - The sustainability of Axcelis' stock price movement will largely depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.57 on revenues of $193.3 million, and for the current fiscal year, it is $2.39 on revenues of $778.8 million [7] Industry Context - The Electronics - Manufacturing Machinery industry, to which Axcelis belongs, is currently ranked in the bottom 9% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Axcelis' stock performance [5] Stock Performance - Axcelis shares have declined approximately 25.5% since the beginning of the year, contrasting with the S&P 500's decline of 3.9% [3] - The estimate revisions trend for Axcelis is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6]

Q1 2025 EARNINGS PRESENTATION MAY 6, 2025 SAFE HARBOR STATEMENT This presentation contains, and the conference call will contain, forward-looking statements under the Private Securities Litigation Reform Act safe harbor provisions. These statements, which include our expectations for spending in our industry and guidance for future financial performance, are based on management's current expectations and should be viewed with caution. They are subject to various risks and uncertainties that could cause actu ...

Financial Data and Key Metrics Changes - The company reported Q1 2025 revenue of $193 million and earnings per diluted share of $0.88, both exceeding expectations, with non-GAAP earnings per share at $1.04 [5][19] - Bookings for the quarter were $110 million, reflecting a sequential increase compared to Q4 2024, resulting in a book-to-bill ratio of 0.8, the highest since Q4 2023 [6][19] - GAAP gross margins were 46.1%, exceeding the outlook of 40%, while non-GAAP gross margins were 46.4% [21][22] - GAAP operating profit was $29.2 million, reflecting a 15.1% operating margin, with non-GAAP operating margin at 18.3% [23] Business Line Data and Key Metrics Changes - Systems revenue was $138 million, and CS and I revenue was $55 million, both slightly above expectations [19] - Sales to mature node applications remained dominant, particularly in Power and General Mature segments [8][10] - Revenue from silicon carbide applications declined sequentially due to moderated customer investments, while engagement in technology transitions remained strong [10][12] Market Data and Key Metrics Changes - China accounted for 37% of total shift system sales, down from 49% in the prior quarter, with expectations for fluctuations in revenue from China throughout 2025 [19][20] - The U.S. saw an increase in shift system sales to 23% of total, while Korea improved to 20%, mainly due to DRAM shipments [19] - The company anticipates a decline in revenue from China on a year-over-year basis as customers digest previous investments [19][20] Company Strategy and Development Direction - The company is focused on innovation and cost control to capture long-term growth opportunities while mitigating tariff impacts [6][8] - Plans are in place to lessen the direct impact of tariffs, leveraging a diversified global supply chain [6][7] - The company aims to maintain strong profitability and invest in R&D to prepare for market recovery [26][85] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term drivers of the semiconductor industry, despite current macroeconomic challenges [16][28] - The company expects revenue in Q2 2025 to be approximately $185 million, with non-GAAP gross margins around 42% [26] - Management noted that while bookings improved, it is premature to call it an inflection point, and they expect continued fluctuations in bookings [39][40] Other Important Information - The company generated $35 million in free cash flow in Q1 2025 and exited the quarter with $587 million in cash and no debt [25][28] - A $100 million increase in share repurchase authorization reflects confidence in long-term business fundamentals [25] Q&A Session Summary Question: What contributed to the robust gross margin? - Management indicated that higher margin spare sales and favorable deferred revenue recognition contributed to the strong gross margin performance [33][35] Question: What is the order intensity for Q2? - Management noted that while bookings increased significantly, it is too early to declare it an inflection point, with most bookings coming from general mature and power segments [39][40] Question: Can you break down the margin performance? - The largest contributor to margin performance was the mix of sales, with expectations for moderation in the second quarter [46] Question: What is the impact of tariffs on margins? - Management acknowledged that while tariffs have a small impact, they have plans in place to mitigate these effects through a global supply base [50][51] Question: What is the composition of the backlog? - The backlog is predominantly general mature, with expectations for it to decrease over time as the company returns to a more standard book-to-bill ratio [56][58] Question: What is the outlook for Japan? - Management expressed optimism about Japan, noting progress in placing tools and anticipating repeat orders as utilization rates improve [70][72] Question: How are technology transitions impacting the business? - The transitions from 150mm to 200mm wafers and from planar to trench devices are expected to benefit the company, particularly in high-energy technology [73][75] Question: What is the outlook for memory business recovery? - The memory business saw an uptick primarily in DRAM, with expectations for broadening out in the future [103]

Revenue and Earnings - Revenue for Q1 2025 was $192.6 million, a decrease of 23.7% compared to $252.4 million in Q1 2024[5] - Net income for Q1 2025 was $28.6 million, down 44.5% from $51.6 million in Q1 2024, resulting in diluted earnings per share of $0.88[5] - Non-GAAP net income for Q1 2025 was $33,784, a decrease of 38.7% compared to $55,234 in Q1 2024[25] - GAAP diluted EPS for Q1 2025 was $0.88, down 43.9% from $1.57 in Q1 2024[25] - Non-GAAP diluted EPS for Q1 2025 was $1.04, a decline of 38.1% from $1.68 in Q1 2024[25] - For Q2 2025, Axcelis expects revenues of approximately $185 million and GAAP earnings per diluted share of approximately $0.57[7] - The company expects GAAP diluted EPS of $0.57 for Q2 2025, with a non-GAAP diluted EPS forecast of $0.73[30] Margins - GAAP gross margin was 46.1%, slightly up from 46.0% in the previous year, while non-GAAP gross margin increased to 46.4%[6] - GAAP operating margin decreased to 15.1% from 22.4% year-over-year, with non-GAAP operating margin at 18.3% compared to 24.1%[5] - Adjusted EBITDA margin for Q1 2025 was 20.5%, down from 25.6% in Q1 2024[28] Cash Position and Expenses - Cash and cash equivalents increased to $184.0 million from $123.5 million at the end of 2024, with no debt reported[17] - Total operating expenses remained relatively stable at $59.6 million compared to $59.5 million in the previous year[15] - Axcelis maintains a strong cash position, with net cash provided by operating activities at $39.8 million for Q1 2025[19] Adjusted Metrics - Adjusted EBITDA for Q1 2025 was $39.5 million, down from $64.5 million in Q1 2024[5] - Adjusted EBITDA for Q1 2025 was $39,520, representing a 38.9% decrease from $64,545 in Q1 2024[28] - Non-GAAP operating income for Q1 2025 was $35,211, down 42.3% from $60,770 in Q1 2024[25] Shareholder Actions - The company is actively repurchasing shares while continuing to invest in innovation and business growth[3] Restructuring Costs - Restructuring costs in Q1 2025 amounted to $1,149, primarily related to global cost-saving initiatives[25]

Company Performance - Axcelis Technologies (ACLS) closed at $45.10, down 0.29% from the previous trading session, underperforming the S&P 500's gain of 2.51% [1] - Over the past month, shares of Axcelis have depreciated by 21.41%, compared to a 12.18% loss in the Computer and Technology sector and an 8.86% loss in the S&P 500 [1] Upcoming Earnings - The earnings report for Axcelis Technologies is scheduled for May 6, 2025, with an expected EPS of $0.39, reflecting a 75.16% decrease from the prior-year quarter [2] - Revenue is anticipated to be $184.65 million, indicating a 26.83% decline from the same quarter last year [2] Full Year Estimates - For the full year, Zacks Consensus Estimates project earnings of $2.55 per share and revenue of $808.8 million, showing changes of -58.54% and -20.54% respectively from the previous year [3] Analyst Forecasts - Recent revisions to analyst forecasts for Axcelis Technologies are important as they indicate changing near-term business trends [4] - Upward revisions in estimates suggest analysts' positive outlook on the company's operations and profit generation capabilities [4] Zacks Rank - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently rates Axcelis Technologies at 3 (Hold) [6] - Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged [6] Valuation Metrics - Axcelis Technologies has a Forward P/E ratio of 17.74, which is lower than the industry's average Forward P/E of 19.3 [7] - The company's PEG ratio stands at 3.24, compared to the industry's average PEG ratio of 0.96 [7] Industry Context - Axcelis Technologies operates within the Electronics - Manufacturing Machinery industry, which is part of the Computer and Technology sector [8] - This industry has a Zacks Industry Rank of 220, placing it in the bottom 12% of over 250 industries [8]

Core Viewpoint - Axcelis Technologies, Inc. will release its financial results for the first quarter of 2025 on May 6, 2025, before market opening [1] Company Information - Axcelis Technologies, Inc. is a leading supplier of ion implantation solutions for the semiconductor industry, with over 45 years of experience [3] - The company focuses on developing high-productivity solutions and providing complete life cycle support for ion implantation systems, which are critical in the integrated circuit manufacturing process [3] Upcoming Events - The company will host a conference call on May 6, 2025, at 8:30 a.m. ET to discuss the financial results, which will be available via webcast [2] - Webcast replays will be accessible for 30 days following the call [2]

Core Viewpoint - The Zacks Electronics - Manufacturing Machinery industry is currently facing challenging macroeconomic conditions and high inventory levels, but companies like Kulicke and Soffa Industries, Axcelis Technologies, and Veeco Instruments are benefiting from increased capital spending in high-performance computing, AI, and other advanced technologies [1][2]. Industry Overview - The industry comprises companies providing solutions for wafer processing, device packaging, and semiconductor manufacturing, including thin-film processing systems and advanced packaging lithography [3]. - There is a growing emphasis on contamination-free transportation and storage of materials, highlighting the importance of micro-contamination control products [4]. Trends Influencing the Industry - Miniaturization in semiconductor manufacturing is driving demand for advanced packaging and new device architectures, which enhances prospects for industry participants [5]. - The complexity of semiconductor manufacturing processes is increasing due to the demand for faster and more energy-efficient semiconductors, driven by cloud computing, IoT, and AI [7][8]. - Strong demand for NAND and DRAM, particularly in data centers and cloud segments, is a positive indicator for the industry [9]. Industry Performance and Valuation - The Zacks Electronics - Manufacturing Machinery industry ranks 234, placing it in the bottom 5% of over 250 Zacks industries, indicating bearish near-term prospects [10][11]. - The industry has underperformed the broader Zacks Computer and Technology sector and the S&P 500, declining 47.2% over the past year compared to the S&P 500's growth of 6.7% [14]. - The current trailing 12-month EV/EBITDA ratio for the industry is 9.59X, significantly lower than the S&P 500's 15.82X and the sector's 14.68X [15]. Company Highlights - **Kulicke and Soffa Industries (KLIC)**: This company designs and manufactures capital equipment for semiconductor assembly. Its new Fluxless Thermo-Compression system is expected to enhance throughput and capture advanced logic customers. The consensus estimate for fiscal 2025 earnings is $1.49 per share, with shares down 35.4% year to date [16][17]. - **Axcelis Technologies (ACLS)**: Specializes in ion implantation and processing equipment, benefiting from strong demand in the silicon carbide market, particularly for EV applications. The consensus estimate for 2025 earnings is $2.55 per share, with shares down 32% year to date [18][19]. - **Veeco Instruments (VECO)**: Expected to benefit from improving demand for its laser annealing and wet processing systems. The consensus estimate for 2025 earnings is $1.35 per share, with shares down 28.2% year to date [19].