Financial Data and Key Metrics Changes - Fourth quarter revenue was $824 million, down 3% year-over-year but up 2% sequentially, at the high end of guidance [17] - Gross margin on a GAAP basis was 43.8% and 44% on a non-GAAP basis, also at the high end of guidance [17] - Adjusted EBITDA margin in Q4 was 27.7% of revenue, above guidance [17] - Full year free cash flow was $404 million, representing a free cash flow margin of 12.7%, nearly a 300 basis point increase year-over-year [19] Business Line Data and Key Metrics Changes - Sales for Material Solutions in Q4 were $362 million, flat year-over-year and up 4% sequentially, driven by advanced deposition materials [18] - Sales for Advanced Purity Solutions in Q4 were $465 million, down 5% year-over-year but up 1% sequentially, with declines driven by fluid handling and FOUPs [19] Market Data and Key Metrics Changes - The semiconductor market is expected to see mid-single-digit industry MSI growth in 2026, with advanced logic positioned for significant growth driven by AI-enabled applications [10][11] - NAND is expected to see more than 20% bit growth in 2026, driven by the shift to higher layer, higher capacity NAND [12] - DRAM is expected to see solid MSI growth in 2026, with tight supply in HBM and DDR5 driving the need for additional fab capacity [13] Company Strategy and Development Direction - The company aims to deepen customer intimacy by supporting technology roadmaps and securing key positions of record in new nodes [7] - The focus is on improving utilization by ramping new facilities in Taiwan and Colorado while rationalizing existing manufacturing [9] - The company plans to increase local-for-local manufacturing, particularly for China, to enhance strategic flexibility [10] Management's Comments on Operating Environment and Future Outlook - The management is cautiously optimistic about industry conditions entering 2026, expecting improvements in node transitions and industry fab construction spending [15] - The company anticipates that the growth in advanced logic and memory will drive higher content per wafer and revenue [15] - Management highlighted the importance of AI as a growth driver, with over 60% of revenue coming from advanced logic and advanced memory [14] Other Important Information - The company expects Q1 sales to range from $785 million to $825 million, reflecting an increase of approximately 4% year-over-year [21] - CapEx for 2026 is expected to decline to $250 million, with a return to historical levels of approximately 7%-8% of sales in the long term [9] Q&A Session Summary Question: Expectations for growth in 2026 compared to underlying markets - Management believes the industry backdrop is more constructive for 2026, with potential for outperformance in advanced logic and memory segments [29][30] Question: Margin trajectory for 2026 - Management indicated that gross margins are expected to stabilize and improve with increased production volumes and facility rationalization [32][34] Question: CapEx and MSI targets for the year - Management expects MSI growth to be mid-single digits for the year, with CapEx-related revenue driven by fab construction spending [38][40] Question: Update on mainstream customer engagement - Management is focusing on deeper penetration of mainstream customers by providing comprehensive solutions across product lines [46][48] Question: Competitive intensity in the China market - Management noted that the fundamentals in China are similar to the rest of the world, emphasizing yield and performance, and highlighted efforts to guarantee supply to customers [50][51] Question: NAND business outlook - Management expects strong underlying demand for NAND, with incremental layer transitions expected to drive higher content per wafer [56][57] Question: Growth expectations for China business in 2026 - Management anticipates growth in the China market, particularly in CapEx-related areas and liquid filtration products [59][60]

Financial Data and Key Metrics Changes - Fourth quarter revenue was $824 million, down 3% year-over-year but up 2% sequentially, at the high end of guidance [17] - Gross margin on a GAAP basis was 43.8% and 44% on a non-GAAP basis, also at the high end of guidance [17] - Adjusted EBITDA margin in Q4 was 27.7% of revenue, above guidance [17] - Full year free cash flow was $404 million, representing a free cash flow margin of 12.7%, nearly a 300 basis point increase year-over-year [19] Business Line Data and Key Metrics Changes - Sales for Material Solutions in Q4 were $362 million, flat year-over-year and up 4% sequentially, driven by advanced deposition materials [18] - Sales for Advanced Purity Solutions in Q4 were $465 million, down 5% year-over-year but up 1% sequentially, with declines driven by fluid handling and FOUPs [19] Market Data and Key Metrics Changes - The semiconductor market is expected to see mid- to single-digit industry MSI growth in 2026, with advanced logic positioned for significant growth driven by AI-enabled applications [11][14] - NAND is expected to benefit from strong AI-driven demand and pricing trends, translating into more than 20% bit growth in 2026 [12] Company Strategy and Development Direction - The company aims to deepen customer intimacy by supporting technology roadmaps and securing key positions of record in new nodes [7] - The focus is on improving utilization by ramping new facilities in Taiwan and Colorado while rationalizing existing manufacturing [9] - The company plans to increase local-for-local manufacturing, particularly for China, to enhance strategic flexibility [10] Management's Comments on Operating Environment and Future Outlook - The management is cautiously optimistic about industry conditions entering 2026, expecting notable improvements compared to 2025 [15] - The company anticipates that node transitions in both logic and memory will drive wafer output and increase content per wafer opportunities [6] Other Important Information - The company expects Q1 sales to range from $785 million to $825 million, reflecting an increase of approximately 4% year-over-year [21] - CapEx for 2025 was $299 million, approximately 9% of sales, and is expected to decline to $250 million in 2026 [20] Q&A Session Summary Question: Expectations for growth in 2026 - The company expects a more constructive industry backdrop in 2026, with potential for outperformance in revenue growth compared to underlying markets [29][30] Question: Margin trajectory for the year - Management indicated that gross margins are expected to stabilize and improve with increased production volumes and facility rationalization [32][34] Question: CapEx and MSI targets for the year - The company anticipates mid-single-digit growth for MSI in 2026, with CapEx expected to be more constructive in the second half of the year [38][40] Question: Update on mainstream customer engagement - The company is focusing on deeper penetration of its product portfolio among mainstream customers, particularly in silicon carbide and mainstream logic [46][48] Question: Competitive intensity in China - The company is working to guarantee supply to Chinese customers, which is critical for competing effectively in that market [50][52] Question: NAND business outlook - The company expects strong underlying demand for NAND, with incremental layer transitions expected to drive higher content per wafer [56][57]

Financial Data and Key Metrics Changes - Fourth quarter revenue was $824 million, down 3% year-over-year but up 2% sequentially, at the high end of guidance [17] - Gross margin on a GAAP basis was 43.8% and 44% on a non-GAAP basis, also at the high end of guidance [17] - Adjusted EBITDA margin in Q4 was 27.7% of revenue, above guidance [17] - Full year free cash flow was $404 million, representing a free cash flow margin of 12.7%, nearly a 300 basis point increase year-over-year [19] Business Line Data and Key Metrics Changes - Material Solutions sales in Q4 were $362 million, flat year-over-year and up 4% sequentially, driven by advanced deposition materials [18] - Advanced Purity Solutions sales in Q4 were $465 million, down 5% year-over-year but up 1% sequentially, with declines driven by fluid handling and FOUPs [19] Market Data and Key Metrics Changes - The semiconductor market is expected to see mid- to single-digit industry MSI growth in 2026, with advanced logic positioned for significant growth driven by AI applications [10][11] - NAND is expected to see more than 20% bit growth in 2026, driven by the shift to higher layer counts [12] Company Strategy and Development Direction - The company aims to deepen customer intimacy by supporting technology roadmaps and securing key positions of record (PORs) in new nodes [6] - Focus on improving utilization by ramping new facilities in Taiwan and Colorado while rationalizing existing manufacturing footprint [9] - Plans to increase local-for-local manufacturing, particularly for China, to enhance supply assurance [10] Management's Comments on Operating Environment and Future Outlook - Management is cautiously optimistic about industry conditions entering 2026, expecting improvements in wafer starts and CapEx spending [14] - The company anticipates that node transitions in both logic and memory will drive growth and increase content per wafer opportunities [5][6] Other Important Information - The company expects CapEx to decline to $250 million in 2026, with a return to historical levels of approximately 7%-8% of sales in the long term [9] - The Capital Markets Day has been rescheduled from May to fall 2026 due to the CFO transition [15] Q&A Session Questions and Answers Question: Expectations for growth in 2026 - The company expects a more constructive industry backdrop in 2026, with potential for outperformance in revenue growth compared to underlying market growth [29][30] Question: Margin trajectory for the year - Management indicated that gross margins are expected to stabilize and improve with increased production volumes and facility rationalization [32][34] Question: CapEx and MSI targets for the year - MSI is expected to grow in the mid-single digits, with CapEx-related revenue driven by fab construction spending anticipated to pick up in the second half of 2026 [38][39] Question: Update on mainstream customer engagement - The company is focusing on deeper penetration of mainstream customers by providing comprehensive solutions across its product portfolio [45][46] Question: Competitive intensity in the China market - The company is working to guarantee supply to Chinese customers, which is critical for competing effectively in that market [51][52] Question: NAND business outlook - The company expects strong underlying demand for NAND, with incremental wafer starts anticipated to remain measured due to node transitions [56][57]