Core Insights - Onto Innovation (ONTO) has made a strategic acquisition of Semilab, which is viewed positively as a productive use of cash [1] - The third quarter earnings report for Onto Innovation was softer than expected, but there are signs of momentum in the business [1] Company Analysis - Onto Innovation is actively engaging in mergers and acquisitions to enhance its market position and capitalize on growth opportunities [1] - The company is part of a broader investment strategy that focuses on significant corporate events, including earnings reports and capital allocation changes [1] Market Context - The investment group "Value In Corporate Events" is dedicated to identifying actionable investment opportunities arising from major corporate events, indicating a proactive approach to market analysis [1]

Core Viewpoint - Onto Innovation Inc. is actively participating in several upcoming investor events, showcasing its commitment to engaging with the investment community and highlighting its technological advancements in the semiconductor industry [1][2]. Company Overview - Onto Innovation Inc. is a leader in process control within the semiconductor sector, offering a diverse portfolio of advanced technologies including un-patterned wafer quality, 3D metrology, macro defect inspection, and factory analytics [3][4]. - The company is headquartered in Wilmington, Massachusetts, and employs approximately 1,590 individuals [6][10]. Financial Performance - For the fiscal year 2024, Onto Innovation reported revenues of $987 million and a net income of $201 million [6][10]. Upcoming Events - The company will participate in the RBC Capital Markets 2025 Global Technology, Internet, Media and Telecommunications Conference on November 19, 2025, and the UBS 2025 Global Technology and AI Conference on December 1-2, 2025 [1][2]. - Additionally, Onto Innovation will attend the Barclays 23rd Annual Global Technology Conference on December 10, 2025, where management will be available for one-on-one meetings [2].

Group 1 - Onto Innovation Inc. (NYSE:ONTO) has experienced a 23% decline in share price year-to-date despite positive trends in the semiconductor sector driven by AI [1] - The company reported third-quarter earnings of $218 million in revenue and $0.92 in earnings per share, falling short of analyst expectations of $220 million in revenue and $0.89 in earnings per share [2] - Onto Innovation is expanding its operations within the semiconductor supply chain and AI manufacturing, including the acquisition of Semilab's materials business and the introduction of its G6 metrology system targeting advanced chip fabrication technologies [3]

Core Insights - The demand for AI and high-performance computing is strong, with NVIDIA projecting global AI infrastructure investments to reach $3 trillion to $4 trillion by the end of the decade, which may reshape the semiconductor supply chain [1] - Onto Innovation is actively developing process control solutions to support the AI era, focusing on advanced packaging and advanced nodes markets [4][12] Financial Performance - Onto Innovation reported Q3 2025 revenue of $218.2 million, slightly above the midpoint of guidance, with a gross margin of 54% and operating margins of 21.1% [8] - The company expects Q4 revenue to range from $250 million to $265 million, representing a sequential growth of 15% to 21% [10][11] Product Development and Technology - The 3DI technology has been successfully qualified by two high bandwidth memory customers, leading to discussions for volume orders [3] - The next-generation Dragonfly system is set to ship soon, with expectations for significant revenue contributions in the second half of 2026 [12][27] Market Outlook - The company anticipates approximately 18% revenue growth in Q4, primarily driven by 2.5D packaging customers, with advanced nodes revenue also expected to improve [5][9] - There is a strong long-term outlook for AI in advanced node investments, supported by aggressive infrastructure expansion plans globally [12][13] Strategic Initiatives - Onto Innovation is enhancing its competitive position through offshoring activities and new product adoption, which are expected to strengthen growth outlook for 2026 [4][7] - The company is in the process of acquiring three product lines from Semi Lab, which is expected to be accretive to revenue and earnings in 2026 [10][43]

Core Insights - Onto Innovation Inc. reported Q3 2025 earnings of $0.92 per share, exceeding the Zacks Consensus Estimate by 5.8%, but down from $1.34 in the prior year [1][9] - The company experienced a 13.5% year-over-year decline in revenues, totaling $218.2 million, which was slightly below the consensus mark but above the midpoint of its guidance [2][9] Revenue Breakdown - Specialty devices and advanced packaging revenues accounted for 52% of total revenues, amounting to $113 million, with expectations to rebound to approximately $150 million in Q4 [3] - Revenues from advanced nodes were $54 million, representing 25% of total revenues, with a forecast to double to about $300 million in 2025 from $148.5 million in 2024 [3] - Software and services revenues were $51 million, making up 23% of total revenues [3] Technology Highlights - Onto's Dragonfly 3Di technology was qualified by two major high-bandwidth memory customers, securing orders for 2.5D logic applications essential for AI accelerators and advanced GPUs [4] - Initial shipments of Atlas G6 OCD systems were made to leading logic and memory customers, with more shipments planned for Q4, indicating strong ongoing demand [4] Q4 Outlook - The company anticipates about 18% revenue growth in Q4, primarily driven by strong demand for 2.5D packaging, with revenues expected to range between $250 million and $265 million [5][11] - Gross margin is projected to improve by about 50 basis points sequentially, with a forecasted range of 53.5% to 55% [12] Margin and Expenses - Non-GAAP gross margin was reported at 54%, slightly down from 54.5% in the previous year, impacted by tariff effects [6] - Non-GAAP operating income decreased to $46.1 million from $70 million year-over-year, with operating expenses rising to $71.9 million [6][7] Liquidity Position - As of September 27, the company had $983.9 million in cash and cash equivalents, with total current liabilities of $162.9 million [8] - The company generated a record $83.4 million in cash from operations, representing a cash conversion of 185% of non-GAAP net income [10] Acquisition Plans - Onto Innovation plans to acquire Semilab for $432.3 million in cash and 641,771 shares, valuing the deal at approximately $495 million, which is about $50 million lower than the original terms [10]

Group 1 - The article does not provide any relevant content regarding the company or industry [1]

分组1 - Onto Innovation reported quarterly earnings of $0.92 per share, exceeding the Zacks Consensus Estimate of $0.87 per share, but down from $1.34 per share a year ago, representing an earnings surprise of +5.75% [1] - The company posted revenues of $218.19 million for the quarter ended September 2025, slightly missing the Zacks Consensus Estimate by 0.02%, and down from $252.21 million year-over-year [2] - Onto Innovation has surpassed consensus EPS estimates three times over the last four quarters, while also topping consensus revenue estimates three times in the same period [2] 分组2 - The stock has underperformed the market, losing about 18.6% since the beginning of the year compared to the S&P 500's gain of 15.6% [3] - The current consensus EPS estimate for the coming quarter is $1.24 on revenues of $257.3 million, and for the current fiscal year, it is $4.89 on revenues of $995.73 million [7] - The Zacks Industry Rank indicates that the Nanotechnology sector is currently in the top 41% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $218.2 million, slightly ahead of the midpoint of previous guidance [11] - Gross margin for Q3 2025 was 54%, impacted by approximately one percentage point due to tariffs [11] - Operating margins were 21.1%, exceeding the top end of guidance [11] - Adjusted earnings per share for the quarter were $0.92, towards the high end of guidance [11] - Cash from operations increased sequentially to $83 million from $58 million in Q2, representing cash conversion of approximately 185% of non-GAAP net income [12] Business Line Data and Key Metrics Changes - Advanced nodes generated revenue of $54 million, or 25% of total revenue, with expected full-year revenue of approximately $300 million, doubling from $148.5 million in 2024 [11][12] - Specialty device and advanced packaging revenue was $113 million, or approximately 52% of revenue, with a strong rebound expected in Q4 [12] - Software and services revenue was $51 million, comprising the remaining 23% of Q3 results [12] Market Data and Key Metrics Changes - The company expects revenue growth of approximately 18% at the midpoint of Q4 guidance, primarily driven by 2.5D packaging customers [7] - Advanced packaging revenue is expected to nearly double from Q3, driven by strong demand for DragonFly systems [8] - Global AI infrastructure investments could reach $3 trillion-$4 trillion by the end of the decade, reshaping the semiconductor supply chain [6] Company Strategy and Development Direction - The company is focused on enhancing its leadership position in advanced packaging and advanced nodes markets [4] - Strategic initiatives include new product adoption, advancing offshoring activities, and preparing for the integration of the Semilab transaction [4] - The company plans to ramp up production capabilities in Asia, aiming to ship over 60% of production demand from international locations by the end of Q1 2026 [9] Management's Comments on Operating Environment and Future Outlook - Management expects organic growth in 2026, with momentum building towards the second half of the year [17] - The long-term outlook for AI and advanced node investments is positive, driven by aggressive infrastructure expansion plans globally [17] - Management noted that while quarterly performance may show variation, sequential growth is expected in the first half of next year [9] Other Important Information - The pending acquisition of Semilab is expected to close in the coming weeks and be accretive to both revenue and earnings in 2026 [10] - The company will switch to a quarterly calendar schedule starting Q1 2026 [15] Q&A Session Summary Question: Expectations for organic growth in advanced packaging and advanced nodes - Management indicated that the first half of 2026 is expected to show sequential growth, with more significant growth in the second half driven by customer expansions and new product adoption [20][21] Question: Gross margin outlook for next year - Management expects tariff impacts to mitigate next quarter, with more meaningful gross margin expansion anticipated in mid to late 2026 as offshore factories ramp up [22][23] Question: Clarification on 2.5D packaging growth - Management confirmed that the sequential growth mentioned was primarily driven by AI packaging and strong demand for DragonFly systems [26][28] Question: Qualification of 3DI tool and its impact - Management expressed hope to be the first choice for HBM4 and noted that the 3DI technology is tied to improving yields through new applications [32][40] Question: Timing of revenue from DragonFly - Management expects incremental revenue from DragonFly in the first half of 2026, with more meaningful revenue anticipated in the second half as customer adoption ramps up [36][38] Question: Visibility on HBM progression - Management noted that visibility is improving, but discussions with suppliers regarding allocations are still ongoing [56][57] Question: Impact of memory market strength on future orders - Management indicated that existing VPAs cover the current year, with discussions now focused on new VPAs for the next year and beyond [51]

Financial Performance - Revenue for Q3 2025 was $218.2 million, a decrease of 13.5% year-over-year from $252.2 million in Q3 2024[7] - Gross margin for Q3 2025 was 50.7%, down from 54.1% in Q3 2024; non-GAAP gross margin was 54.0%, compared to 54.5% in Q3 2024[7] - Operating income for Q3 2025 was $23.7 million, or 10.9% of revenue, down from $53.1 million, or 21.0% of revenue, in Q3 2024[7] - Net income for the three months ended September 27, 2025, was $28.224 million, compared to $53.051 million in the same period last year, reflecting a decline of 46.8%[31] - Non-GAAP net income for the three months ended September 27, 2025, was $45.125 million, down from $66.386 million in the prior year[31] - Diluted earnings per share for the three months ended September 27, 2025, was $0.92, compared to $1.34 for the same period in 2024[28] Cash Flow and Assets - The company generated record cash from operations of approximately $83.4 million in Q3 2025, representing 185% conversion of non-GAAP net income[6] - Total assets as of September 27, 2025, were $2.186 billion, an increase from $2.117 billion at the end of 2024[25] - Cash and short-term investments at the end of Q3 2025 totaled $983.9 million, up from $852.3 million at the end of 2024[25] Future Guidance - For Q4 2025, the company expects revenue between $250 million and $265 million, with GAAP diluted earnings per share projected to be between $0.85 and $1.00[10] - Non-GAAP net income for Q4 2025 is expected to be $28.2 million, or earnings per share of $0.57, compared to $53.1 million, or earnings per share of $1.07, in Q4 2024[9] - The company provided guidance for the fourth quarter of 2025, estimating U.S. GAAP operating income between $39.8 million and $48.3 million, with an EPS range of $0.85 to $1.00[32] Research and Development - Research and development expenses increased to $32.493 million for the three months ended September 27, 2025, from $28.277 million in the prior year, indicating a focus on innovation[27] Product Developments - The company shipped initial Atlas® G6 OCD systems to several leading logic and memory customers, with additional shipments scheduled for Q4 2025[6] - The Dragonfly® 3Di™ technology is now fully qualified by two major high bandwidth memory (HBM) customers, with orders secured for 2.5D logic applications supporting AI packaging[6]

Industry Overview - Nanotechnology stocks represent companies focused on developing, manufacturing, or commercializing technologies and materials at the nanoscale, which ranges from approximately 1 to 100 nanometers. These include advanced materials, nanoelectronics, targeted drug-delivery systems, and nanosensors [2] - These stocks offer thematic exposure to high-growth, often early-stage and technically specialized fields, making them potentially more volatile and speculative [2] Company Summaries Onto Innovation (ONTO) - Onto Innovation Inc. specializes in designing, developing, manufacturing, and supporting process control tools for optical metrology. The company provides lithography systems and process control analytical software, along with process and yield management solutions [3] Nano Dimension (NNDM) - Nano Dimension Ltd. engages in additive manufacturing solutions, offering 3D printers that produce high-performance electronic devices (Hi-PEDs) using proprietary conductive and dielectric substances. The company also provides micro additive manufacturing systems and industrial additive manufacturing systems for fabricating ceramic and metal parts [4] NVE Corporation (NVEC) - NVE Corporation develops and sells devices utilizing spintronics, a nanotechnology that leverages electron spin for data acquisition, storage, and transmission. The company manufactures spintronic products, including sensors and couplers [5] Clene Inc. (CLNN) - Clene Inc. is a clinical-stage pharmaceutical company focused on discovering, developing, and commercializing novel clean-surfaced nanotechnology therapeutics. Its lead drug candidate, CNM-Au8, is undergoing various clinical trials for conditions such as amyotrophic lateral sclerosis (ALS), chronic optic neuropathy, and Parkinson's Disease [6][7]