Core Viewpoint - Axcelis Technologies and Veeco Instruments have received stockholder approval for their merger, valued at approximately $4.4 billion, aimed at creating a significant player in the semiconductor equipment industry, with completion expected in the second half of 2026 [1]. Company Overview - Axcelis, based in Beverly, Massachusetts, has over 45 years of experience in providing solutions for the semiconductor industry, specializing in ion implantation systems essential for integrated circuit manufacturing [2]. - Veeco, located in Plainview, New York, manufactures semiconductor process equipment, including technologies such as laser annealing, ion beam deposition, and metal organic chemical vapor deposition (MOCVD), which are critical for advanced semiconductor device fabrication and packaging [3]. Merger Details - The merger will see Veeco shareholders receive 0.3575 Axcelis shares for each Veeco share owned, resulting in Axcelis shareholders owning approximately 58% and Veeco shareholders about 42% of the merged entity [5]. - The combined company is expected to expand its total addressable market to over $5 billion, driven by growth in AI and related power solution demands [5]. - The merger is projected to make the new entity the fourth largest US wafer fabrication equipment supplier by revenue [6]. Financial Projections - The combined company anticipates annual run-rate cost synergies of $35 million within two years post-closing, with a significant portion expected to be realized in the first year [7]. - On a pro-forma basis for fiscal year 2024, the merged entity is projected to generate $1.7 billion in revenue, with a non-GAAP gross margin of 44% and an adjusted EBITDA of $387 million [7].

Q3 2025 Financial Performance - Revenue for Q3 2025 was $213.6 million, with systems revenue contributing $143.7 million and CS&I (Customer Solutions and Innovation) revenue reaching a record $69.9 million[8, 24] - Non-GAAP diluted earnings per share (EPS) for Q3 2025 was $1.21, while GAAP diluted EPS was $0.83[8] - The company's Q3 2025 GAAP gross margin was 41.6%, and the Non-GAAP gross margin was 41.8%[25] - Adjusted EBITDA for Q3 2025 was $43.2 million, representing an Adjusted EBITDA Margin of 20.2%[25] Revenue Breakdown and Market Segment - Mature process technology accounted for 95% of total shipped system revenue in Q3 2025[15] - Power general mature contributed 70% of total shipped system revenue, with 25% specifically from general mature[16] - Silicon Carbide (SiC) power applications made up 52% of shipped system revenue, while other power applications accounted for 18%[12] - Advanced logic contributed 3% and memory 2% of shipped system revenue in Q3 2025[12] - China accounted for 46% of total revenue, followed by the US at 14%, South Korea at 10%, and Europe at 11%[24] Q4 2025 Outlook - The company anticipates Q4 2025 revenue to be approximately $215 million[28] - Non-GAAP gross margin is projected to be around 43.0%, with Non-GAAP operating expenses estimated at $56 million[28] - Adjusted EBITDA for Q4 2025 is expected to be approximately $41 million, and Non-GAAP diluted earnings per share are projected at $1.12[28]

Transaction Overview - Axcelis and Veeco are combining to create an industry-leading semiconductor equipment company[1,29,55] - The transaction is an all-stock deal where Veeco shareholders will receive 03575 Axcelis shares for each Veeco share[52] - The combined company will be headquartered in Beverly, Massachusetts and assume a new name and ticker symbol[52] - The transaction is expected to close in the second half of 2026, subject to shareholder and regulatory approvals[52] Financial Highlights - The combined company will have a pro forma cash position exceeding $900 million[24,28,30,52,56] - The combined company's 2024 revenue is approximately $17 billion[27,36] - The combined company's non-GAAP gross margin is 44%[27,30,56] - The combined company's adjusted EBITDA is approximately $387 million[28,30] - The combined company expects to realize $35 million in annual run-rate cost synergies within 24 months after closing[52,53] Strategic Rationale - The combination expands the addressable market opportunity to over $5 billion[30,56] - The merger creates a broader product portfolio and complementary end markets[22,23,25,30,35,36,41,42,44,45] - The combined company will have a robust R&D and innovation engine[23]

Transaction Overview - Axcelis and Veeco are combining to create an industry-leading semiconductor equipment company[1] - The transaction is an all-stock deal where Veeco shareholders will receive 03575 Axcelis shares for each Veeco share[52] - The combined company will have an estimated enterprise value of approximately $44 billion[52] - Pro forma ownership at closing is estimated to be approximately 58% Axcelis shareholders and 42% Veeco shareholders[52] - The transaction is expected to close in the second half of 2026[52] Financial Highlights - The combined company is expected to have over $900 million in cash[24, 27, 30, 52] - The combined company had approximately $17 billion in pro-forma 2024 revenue[27, 36] - The combined company had a 44% non-GAAP gross margin in FY24[27, 30, 53] - The combined company had approximately $230 million in combined R&D spend in FY24[27] - The combined company had approximately $387 million in adjusted EBITDA in FY24[27, 53]