Group 1: Market Overview - Equities experienced strong growth in Q3 2025, with several reaching record highs [1] - The US Federal Reserve reduced its benchmark interest rate for the first time in the year during Q3 [1] Group 2: Fund Performance - The American Century Investments Small Cap Value Fund returned 4.69% in Q3 2025, underperforming the Russell 2000 Value Index, which returned 12.60% [1] - The fund focuses on investing in undervalued small-cap companies with potential earnings capability [1] Group 3: Axcelis Technologies, Inc. (NASDAQ:ACLS) - Axcelis Technologies, Inc. reported a one-month return of -5.51% and a 52-week gain of 15.67% [2] - The stock closed at $86.12 per share on January 2, 2026, with a market capitalization of $2.67 billion [2] - The company generated revenue of $214 million and non-GAAP earnings per diluted share of $1.21 in Q3 2025, exceeding expectations [5] - Axcelis has shown improved performance due to better-than-expected profits and stabilizing demand in the semiconductor sector [3] Group 4: Hedge Fund Interest - Axcelis Technologies, Inc. was held by 33 hedge fund portfolios at the end of Q3 2025, an increase from 29 in the previous quarter [5]

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].