Market Overview - Some investors express concerns about an expensive market near all-time highs, but not all stocks are expensive or near their highs [1] - The high-growth technology sector, particularly companies focused on the auto and industrial markets, is experiencing a downturn due to rising interest rates leading to decreased demand [1] Axcelis Technologies - Axcelis Technologies is a leader in ion implantation equipment for semiconductor manufacturing, with a significant portion of its sales tied to silicon carbide (SiC) production [3][4] - Despite a downturn, 41% of Axcelis' 2024 sales are from SiC, and 97% are from trailing-edge chips used in various applications [4] - Earnings per share (EPS) peaked at $7.43 in 2023 but fell to $6.15 in 2024, with a projected 27% sequential revenue decline in Q1 2025 and EPS expected to drop to $0.38 [5] - The stock has decreased 66% from its 2023 high of $201 to $59, but the company has $571.3 million in cash and no debt, equating to $17.48 per share, which is nearly 30% of its market cap [6] - Long-term investors may find value at current prices, as the company is generating cash during the downturn [7] IPG Photonics - IPG Photonics produces high-end lasers for industrial and medical applications and has faced significant challenges, including a downturn exacerbated by the Russia-Ukraine conflict [8][9] - The stock has fallen 74% from a high of $264 in 2021 to around $64 today, but the company holds $930.1 million in cash with no debt, representing $21.86 per share, or about one-third of its market cap [10] - The company’s peak earnings were $5.16 per share in 2021, and current trading reflects a P/E ratio of 12, which drops to 8.1 when excluding cash [10] - The new CEO plans to invest in differentiating technologies while being less aggressive with share repurchases, which may lead to short-term losses [11][12] - If there is a recovery in the industrial or auto sectors, IPG could see significant stock price appreciation, supported by its cash reserves [12]

Core Viewpoint - Axcelis Technologies reported strong fourth-quarter results but issued disappointing forward guidance, leading to a significant drop in stock price [1][2][3]. Financial Performance - The company reported earnings per share (EPS) of $1.54 on revenue of $252.42 million for the fourth quarter, surpassing analyst estimates of $1.25 EPS and $244.95 million in revenue [2]. - Year-over-year sales declined approximately 19%, but the results still exceeded Wall Street targets [2]. - Diluted EPS fell roughly 28% compared to the prior year, yet remained better than average analyst expectations [3]. Forward Guidance - For the first quarter, management anticipates revenue of approximately $185 million, significantly lower than the $221.6 million expected by analysts and down from $252.4 million in the same quarter last year [4]. - Projected earnings per diluted share are expected to be $0.38, a substantial decrease from $1.57 a year ago [4]. Market Outlook - Despite expectations for growth in the silicon carbide market, Axcelis anticipates weaker demand as customers deplete existing supplies [5]. - Overall revenue is expected to decline this year due to this trend and softer demand in the Chinese market [5]. - Management does foresee moderate sales improvement in the second half of the year, with strong long-term results expected from product categories like silicon carbide and memory recovery [6].

Financial Data and Key Metrics Changes - The company reported fourth quarter revenues of $252 million, with earnings per diluted share of $1.54, exceeding expectations due to strong demand in CS&I sales [7][30] - Gross margins for the fourth quarter were 46%, surpassing the outlook of 42.5%, driven by better-than-expected CS&I revenue [33] - For the full year 2024, total revenue was $1.02 billion, with gross margins of 44.7%, a 120 basis point increase year-over-year despite lower revenue volume [36] Business Line Data and Key Metrics Changes - System sales saw a sequential decline in Power and Image Sensors, but improvements were noted in General Mature and Memory sales [8][9] - CS&I revenue for the fourth quarter was $65 million, with stronger upgrade activity contributing to a 17% sequential growth [30][31] - Silicon Carbide system sales grew approximately 6% year-over-year, with expectations of a slight decline in 2025 due to customer digestion periods [10][12] Market Data and Key Metrics Changes - China accounted for 49% of total shipped system sales, with a sequential decline primarily due to a drop in Image Sensor sales [31] - System sales to Korea improved to 11% in the fourth quarter, up from 1% in the third quarter, mainly due to improved memory shipments [31] - The company anticipates a muted NAND market in 2025, while expecting growth in DRAM driven by AI and increased memory content in devices [20][22] Company Strategy and Development Direction - The company aims to capture growth opportunities in Silicon Carbide and Advanced Logic markets, focusing on technology engagement with customers [26][50] - A strategic goal is to expand within the Advanced Logic market, which is seen as a multi-year initiative [18] - The company plans to continue investing in product innovation and customer technology roadmaps despite near-term market digestion [39][40] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in a stronger second half of 2025 based on backlog and customer conversations, despite a muted near-term demand backdrop [55][57] - The company expects overall revenue in 2025 to decline year-over-year, with a focus on DRAM investments while NAND remains muted [24][25] - Management highlighted the importance of maintaining strong margins and cost control amidst a dynamic demand environment [23][39] Other Important Information - The company exited 2024 with a strong balance sheet, consisting of $571 million in cash and no debt, allowing for continued investment and share repurchase programs [38][40] - New reporting changes will include non-GAAP measures and the inclusion of Image Sensor revenue in the General Mature category starting in Q1 2025 [41][42] Q&A Session Summary Question: Factors for a stronger second half in 2025 - Management indicated that backlog and customer conversations suggest a stronger second half, with bookings stabilizing and projects formalizing [55][56] Question: Memory revenue expectations - Management expects the majority of memory revenue in 2025 to come from DRAM, with NAND remaining muted due to capacity issues [59][60] Question: Impact of export controls on revenue - Management clarified that recent information provided confidence in system shipments, adjusting the estimated impact of export controls to the low end of the previously guided range [63][65] Question: Dynamics of digestion in the first quarter - Management noted that digestion in the Power and General Mature markets is primarily in China, with resilience observed in other geographies [72][75] Question: Silicon Carbide revenue exposure - Management confirmed that while China is a significant market for Silicon Carbide, the business remains robust globally, with diverse customer engagement [88][90] Question: Increase in CS&I revenue - Management attributed the 17% sequential growth in CS&I to stronger upgrade activity and execution on service contracts across multiple regions [107][108]

Q4 2024 EARNINGS PRESENTATION FEBRUARY 11, 2025 Strong demand for aftermarket CS&I sales Sequential decline in Power and Image Sensor, offset by an improvement in General Mature and Memory CS&I sales the primary driver behind better-than-expected margins and EPS Bookings stabilized, and flat on a sequential basis 3 SHIPPED SYSTEMS REVENUE BY SEGMENT: Q4 & FULL YEAR 2024 p o w e r m a t u r e n o d e s p o w e r m a t u r e n o d e s Q4'24 SEGMENT 2024* 36% SILICON CARBIDE (SiC) 41% 14% SILICON IGBT 15% 34% ...

Core Insights - Axcelis Technologies (ACLS) reported quarterly earnings of $1.54 per share, exceeding the Zacks Consensus Estimate of $1.25 per share, but down from $2.15 per share a year ago, indicating an earnings surprise of 23.20% [1] - The company achieved revenues of $252.42 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.07%, but down from $310.29 million year-over-year [2] - Axcelis has consistently surpassed consensus EPS estimates over the last four quarters [2] Earnings Outlook - The immediate price movement of Axcelis shares will depend on management's commentary during the earnings call and future earnings expectations [3][4] - Current consensus EPS estimate for the upcoming quarter is $1.03 on revenues of $225.7 million, and for the current fiscal year, it is $5 on revenues of $974.65 million [7] Industry Context - The Electronics - Manufacturing Machinery industry, to which Axcelis belongs, is currently ranked in the bottom 10% of over 250 Zacks industries, which may negatively impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5]

Financial Performance - For the full year 2024, Axcelis reported revenue of $1.02 billion, a decrease of 9.7% compared to $1.13 billion in 2023[2] - Fourth quarter revenue was $252.4 million, down from $256.6 million in the third quarter of 2024, with a gross margin of 46.0%[3] - Operating profit for the full year 2024 was $210.8 million, compared to $265.8 million in 2023, reflecting a decline of 20.7%[2] - Net income for 2024 was $201 million, with diluted earnings per share of $6.15, down from $246.3 million and $7.43 per share in 2023[2] - Net income for Q4 2024 was $49,956 million, a decrease of 29.5% compared to $71,056 million in Q4 2023[16] Future Outlook - Axcelis expects first quarter 2025 revenues of approximately $185 million and earnings per diluted share of approximately $0.38[6] - The company plans to focus on product innovation and cost management to capture long-term growth opportunities[4] Cash and Assets - Cash and cash equivalents decreased to $123.5 million as of December 31, 2024, from $167.3 million a year earlier[14] - Total assets increased to $1.35 billion as of December 31, 2024, compared to $1.28 billion in 2023[14] - Cash, cash equivalents, and restricted cash at the end of the period stood at $131,064 million, unchanged from the previous year[16] Cash Flow and Financing - Net cash provided by operating activities for the twelve months ended December 31, 2024, was $140,818 million, down from $156,869 million in the previous year, reflecting a decrease of 10.2%[16] - Cash flows from investing activities showed a net cash used of $108,726 million for the twelve months ended December 31, 2024, compared to $100,858 million in 2023, indicating an increase in cash outflow of 7.4%[16] - The net cash used in financing activities for the twelve months ended December 31, 2024, was $71,192 million, compared to $68,268 million in 2023, indicating an increase of 2.7%[16] Shareholder Returns - The company returned capital to shareholders through buybacks, exiting the year with a stronger balance sheet[4] - The company repurchased $60,489 million of common stock in the twelve months ended December 31, 2024, compared to $52,499 million in 2023, representing an increase of 15.2%[16] Expenses - Depreciation and amortization expenses for Q4 2024 were $4,267 million, up from $3,581 million in Q4 2023, reflecting an increase of 19.2%[16] - Stock-based compensation expense for the twelve months ended December 31, 2024, was $20,951 million, an increase of 14.8% from $18,269 million in 2023[16] Operational Changes - The company experienced a significant change in operating assets and liabilities, with a net decrease of $46,381 million in Q4 2024 compared to a slight increase of $264 million in Q4 2023[16] - The effect of exchange rate changes on cash and cash equivalents resulted in a decrease of $3,013 million in Q4 2024, contrasting with an increase of $1,128 million in Q4 2023[16]

Financial Performance - For the full year 2024, the company reported revenue of $1.02 billion, a decrease from $1.13 billion in 2023. Systems revenue was $782.6 million, down from $883.6 million in 2023. Operating profit was $210.8 million compared to $265.8 million in 2023. Net income for the year was $201 million with diluted earnings per share of $6.15, down from net income of $246.3 million and diluted earnings per share of $7.43 in 2023. Gross margin improved to 44.7% from 43.5% in 2023 [2][4]. - In Q4 2024, the company reported revenue of $252.4 million, slightly down from $256.6 million in Q3 2024. Gross margin for the quarter was 46.0%, an increase from 42.9% in Q3. Operating profit for the quarter was $54.5 million, up from $46.9 million in Q3. Net income for the quarter was $50 million, or $1.54 per diluted share, compared to $48.6 million, or $1.49 per diluted share in Q3 [3][8]. Management Commentary - The President and CEO highlighted that the company exited the year strongly, with Q4 revenue and profitability exceeding expectations. Looking ahead to 2025, the company anticipates a cyclical digestion period as customers adjust to previous investments, particularly in China. The focus will be on long-term growth opportunities through product innovation, cost management, and collaboration with customers on technology roadmaps [4]. - The Executive Vice President and CFO expressed satisfaction with the financial execution in 2024, noting the ability to deliver higher gross margins and solid free cash flow despite a revenue decline. The company returned capital to shareholders via buybacks and ended the year with a stronger balance sheet, positioning itself to invest during the cyclical digestion period [4]. Business Outlook - For Q1 2025, the company expects revenues of approximately $185 million and earnings per diluted share of approximately $0.38 [5].

Core Insights - Axcelis Technologies, Inc. will showcase its Purion™ platform of ion implanters at SEMICON Korea 2025, highlighting trends such as AI, advanced packaging, and sustainable semiconductor manufacturing technologies [1][2] Company Overview - Axcelis has over 45 years of experience providing innovative, high-productivity solutions for the semiconductor industry, focusing on ion implantation systems [3] Event Participation - The company will be located at Booth D622 during SEMICON Korea, emphasizing its commitment to the Korean market and the expansion of its operations with a new Asia HUB Warehouse [2] Product Offerings - The Purion™ platform is the flagship implant platform, addressing various implant requirements for existing and emerging applications [5] - The Purion Power Series™ is designed for power devices, accommodating multiple wafer sizes (150mm, 200mm, and 300mm) and various substrate types [5] - New upgrade offerings include enhancements for performance and efficiency, featuring innovative source technology and productivity packages [5]

The latest trading session saw Axcelis Technologies (ACLS) ending at $66.15, denoting a +0.68% adjustment from its last day's close. The stock trailed the S&P 500, which registered a daily gain of 0.72%. Meanwhile, the Dow experienced a rise of 0.3%, and the technology-dominated Nasdaq saw an increase of 1.35%.The semiconductor services company's stock has dropped by 11.75% in the past month, falling short of the Computer and Technology sector's loss of 1.35% and the S&P 500's gain of 1.02%.The investment c ...

Award Recognizes Companies Who Achieve Highest Level of Safety BEVERLY, Mass., Feb. 3, 2025 /PRNewswire/ -- Axcelis Technologies, Inc. (Nasdaq: ACLS), a leading supplier of enabling ion implantation solutions for the semiconductor industry, has received the '2024 SK hynix CSO Safety and Health Award'. This prestigious award honors companies whose dedication and commitment in supplying products and services meet SK hynix's high standards for fab site and personal safety. The award was presented by Kim Youngs ...