Financial Data and Key Metrics Changes - Third quarter revenue was $807 million, flat year-over-year and up 2% sequentially, in line with guidance [13] - Gross margin on a GAAP basis was 43.5% and 43.6% on a non-GAAP basis, below guidance due to underutilization of manufacturing assets [13][14] - Free cash flow reached $191 million, the highest in six years, driven by a focus on working capital and a reduction in inventory levels [16] Business Line Data and Key Metrics Changes - Material Solutions segment sales were $349 million, up 1% year-on-year and down 2% sequentially, driven by CMP consumables and cleaning chemistries [15] - Advanced Purity Solutions sales were $461 million, essentially flat year-on-year and up 5% sequentially, with record sales in liquid filtration [15][16] - Adjusted operating margin for Material Solutions was 18.9%, down year-over-year and sequentially, while Advanced Purity Solutions had a margin of 25.9% [15][16] Market Data and Key Metrics Changes - Advanced logic continues to show strong growth driven by AI applications, while mainstream logic demand remains mixed and below prior peak levels [9][10] - Memory pricing trends have improved, particularly for HBM, with renewed optimism in 3D NAND driven by AI demand [10][11] - Overall, year-on-year unit-driven revenue grew, led by CMP slurries, pads, cleans, and liquid filtration, while CapEx-driven revenue declined high single digits year-on-year [11] Company Strategy and Development Direction - The company aims to enhance customer intimacy and support technology roadmaps through organic innovation and accelerated product development [6][7] - There is a focus on ramping new facilities in Taiwan and Colorado to meet future demand and offset margin pressures [7][8] - The company plans to improve free cash flow and reduce leverage, with a goal to lower gross leverage to below 4x [17][66] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in capturing market share during the next upcycle despite current underutilization of assets [9] - The semiconductor market is expected to remain challenging, with a wait-and-see approach being adopted for future orders [11][36] - Management noted that while advanced logic is strong, mainstream logic recovery is slow, and they are preparing for various scenarios [36][41] Other Important Information - The company plans to host an Investor Day on May 11, 2026, to share more details about its strategy and outlook [19] - The company is committed to local-for-local manufacturing, expecting over 90% of products for China to be locally produced by 2026 [48][50] Q&A Session Summary Question: Strategic or commercial differences to implement - Management plans to expand customer engagement models to include more ecosystem partners and mainstream logic customers [22] Question: Impact of BIS bands on revenue - Management confirmed that the BIS bands did not impact revenue in the current quarter and are not expected to affect 2026 [28] Question: Utilization across sites - Management acknowledged underutilization but emphasized a focus on cash flow and free cash flow, balancing inventory and production [30][32] Question: Wait-and-see approach for wafer starts - Management indicated that while advanced logic remains strong, mainstream logic recovery is slow, and they are preparing for various scenarios [36][41] Question: Demand shift in Material Solutions - Management clarified that the demand shift was more related to Q2 and Q3, with challenges in predicting shifts due to the trade environment [46] Question: Product rationalization for China - Management expects minimal impact on revenue from product rationalization, with a focus on local-for-local manufacturing [48] Question: Qualification of KSP South site - Management reported being behind schedule on qualifications but expects to materially increase volume in 2026 [77]

Financial Data and Key Metrics Changes - Third quarter revenue was $807 million, flat year-over-year and up 2% sequentially, in line with guidance [15] - Gross margin on a GAAP basis was 43.5% and 43.6% on a non-GAAP basis, below guidance due to underutilization of manufacturing assets [15][16] - Free cash flow reached $191 million, the highest in six years, driven by a focus on working capital and a reduction of approximately $50 million in inventory levels [18] Business Line Data and Key Metrics Changes - Material Solutions sales were $349 million, up 1% year-over-year and down 2% sequentially, driven by CMP consumables and cleaning chemistries [17] - Advanced Purity Solutions sales were $461 million, essentially flat year-over-year and up 5% sequentially, with record quarterly sales in liquid filtration [17] Market Data and Key Metrics Changes - Advanced logic continues to show strong growth driven by AI-enabled applications, while memory demand remains mixed and below prior peak levels [10][11] - Industry wafer starts are modestly higher this year, led by advanced logic, but other markets remain muted [11] Company Strategy and Development Direction - The company aims to enhance customer intimacy and support technology roadmaps with deep application expertise and strong organic innovation [7] - There is a commitment to accelerate the qualification and ramp of new facilities in Taiwan and Colorado to meet future demand [8] - The focus is on improving free cash flow and reducing leverage through operational efficiencies and reduced capital expenditures [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in capturing market share during the next upcycle despite current underutilization of assets [10] - There is a cautious optimism regarding AI-driven growth in both advanced logic and memory, with a wait-and-see approach being adopted [12][40] Other Important Information - The company plans to host an Investor Day on May 11, 2026, to share more details about its strategic direction [20] Q&A Session Summary Question: Strategic or commercial differences to implement - The CEO highlighted a focus on expanding customer engagement models and enhancing operational capabilities in new facilities [24][25] Question: Impact of BIS bands on revenue - Management confirmed that the BIS bands did not impact revenue in the current quarter and are not expected to affect 2026 [30] Question: Utilization across sites - The CEO noted that while there is significant capacity available, the focus has been on cash flow and inventory management rather than immediate ramp-up [32][33] Question: Demand shifts in Material Solutions - Management clarified that the demand shift was more related to the transition from Q2 to Q3, influenced by the trade environment [48] Question: Local for local manufacturing strategy in China - The company expects to achieve over 90% local for local manufacturing for Chinese customers by 2026, which should not materially impact revenue [51][52] Question: Content growth opportunities from node transitions - The CEO expressed optimism about content growth from advanced nodes, particularly in liquid filtration and CMP solutions [60] Question: Qualification of KSP South site - Management acknowledged being behind schedule in the qualification process but expects to materially increase volume in 2026 [82]

Entegris Earnings Summary Third Quarter 2025 October 30, 2025 ENTEGRIS PROPRIETARY AND CONFIDENTIAL – INTERNAL Safe Harbor ENTEGRIS THIRD QUARTER 2025 EARNINGS SUMMARY This presentation contains "forward-looking statements." The words "believe," "expect," "anticipate," "intend," "estimate," "forecast," "project," "should," "may," "will," "would" or the negative thereof and similar expressions are intended to identify such forward-looking statements. These forward-looking statements are based on current mana ...

Core Insights - Entegris, Inc. reported Q2 2025 net sales of $792.4 million, reflecting a 2% sequential increase and exceeding guidance [1] - Non-GAAP diluted EPS was $0.66, while GAAP diluted EPS decreased to $0.35 from $0.41 in the previous quarter [1] - The adjusted operating margin was 20.9%, with adjusted EBITDA at 27.3% of sales and a gross margin of 44.4% [1] - Net income fell from $67.7 million to $52.8 million year-over-year [1] Revenue and Earnings Projections - Entegris projects Q3 revenue between $780 million and $820 million, with GAAP EPS expected to be between $0.43 and $0.50, and non-GAAP EPS between $0.68 and $0.75 [3] - The adjusted EBITDA margin for the next quarter is anticipated to be approximately 27.5% [3] Market and Growth Factors - CEO Bertrand Loy highlighted trade policy and macroeconomic uncertainties impacting fab activity, but noted growth was driven by CMP consumables, selective etch, and deposition materials [2] - The company remains optimistic about long-term semiconductor demand, emphasizing its unique materials science capabilities and AI-driven growth [3]