Onto Innovation Inc (ONTO) reported second-quarter 2024 earnings of $1.32 per share, which beat the Zacks Consensus Estimate by 10.9%. The bottom line compared favorably with the prior-year quarter's 79 cents per share. Revenues of $242.3 million beat the Zacks Consensus Estimate by 2.9%. The top line expanded 27.1% year over year. The uptick was largely driven by the expansion of pilot lines for high-performance computing, which incorporates cutting-edge gate-all-around transistor architecture and high-ban ...

Financial Data and Key Metrics Changes - Second quarter revenue reached $242 million, up 6% sequentially and 27% year-over-year, exceeding guidance due to strong demand for advanced packaging and software services [8][9] - Earnings per share (EPS) increased 12% sequentially to $1.32 and up 67% year-over-year [8] - Operating cash flow was a record $65 million, representing 27% of revenues, with a significant improvement in cash generation compared to the previous year [8][10] Business Line Data and Key Metrics Changes - Specialty device and advanced packaging revenue grew 3% sequentially to a record $164 million, accounting for 68% of total revenue [9] - Advanced nodes revenue increased 21% over Q1 to $32 million, representing 13% of total revenue [9] - Software and services revenue was $46 million, up 6% over Q1, making up 19% of total revenue [9] Market Data and Key Metrics Changes - The advanced packaging market, particularly driven by AI packaging, accounted for over half of the revenue in specialty device and advanced packaging markets [4] - Orders from logic customers represented nearly half of the revenue from advanced node customers, indicating strong demand in this segment [7] Company Strategy and Development Direction - The company is focusing on expanding capabilities in advanced packaging and advanced nodes, with expectations of continued growth in these areas [12][13] - New product introductions, such as a 3D bump metrology sensor, are aimed at addressing the evolving needs of the market [5] - The company anticipates further growth in advanced nodes driven by increasing orders for memory and gate-all-around logic applications [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of 2024, expecting revenue to be 5% to 10% stronger than the first half [13] - The company is encouraged by the demand for AI packaging and the expected increase in HBM content for AI processors [13] - Management noted that supply constraints are still impacting some customers, but overall demand remains strong [15] Other Important Information - The company ended the quarter with cash and short-term investments of $786 million and plans to reduce inventory levels further [10] - A volume purchasing agreement worth over $300 million was closed with two customers, covering AI packaging and gate-all-around investments through 2025 [13][42] Q&A Session Summary Question: What improved in the outlook for advanced packaging? - Management clarified that the previous pause in AI packaging was specific to a few customers, while overall advanced packaging is expected to grow sequentially [15] Question: How is the $300 million volume purchasing agreement split among customers? - The advanced packaging portion is larger, with most revenue recognition expected to occur in 2025 [16][18] Question: What impact do reduced CapEx plans from an IDM customer have? - Management remains optimistic, expecting that the focus will shift to leading-edge technologies, potentially benefiting the company [22] Question: What is driving the delta between AI packaging and overall advanced packaging growth? - Management noted that OSATs are starting to spend more, contributing to overall advanced packaging growth despite a pause in AI-specific spending [23] Question: What is the expected decline in AI packaging revenues? - Management estimated an aggregate decline of around 10% to 15% in AI packaging revenues from the first half to the second half of the year [24] Question: How is the gross margin improvement being driven? - Management indicated that improvements in manufacturing and supply chain efficiencies are contributing to the gross margin increase [25] Question: What is the company's strategy regarding China exposure? - Management expects second half revenue from China to be up over the first half, focusing on high-end applications despite local competition [40][41] Question: When will shipments related to the $300 million VPA begin? - Initial shipments are expected in the second half of the year, with the bulk occurring throughout 2025 [42] Question: Where has the company gained the most market share? - The company has maintained a high share in AI packaging and has seen increases in adoption of its Iris planar films for gate-all-around applications [45]

Onto Innovation (ONTO) came out with quarterly earnings of $1.32 per share, beating the Zacks Consensus Estimate of $1.19 per share. This compares to earnings of $0.79 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 10.92%. A quarter ago, it was expected that this maker of semiconductor manufacturing equipment would post earnings of $1.10 per share when it actually produced earnings of $1.18, delivering a surprise of 7.27%. O ...

EXHIBIT 99.1 Onto Innovation Reports 2024 Second Quarter Results Strong demand for AI packaging and orders for emerging gate-all-around nodes drive revenue above high end of guidance Wilmington, Mass., August 8, 2024 – Onto Innovation Inc. (NYSE: ONTO) ("Onto Innovation," "Onto," or the "Company") today announced financial results for the second fiscal quarter of 2024. Second Quarter Financial Highlights • Revenue of $242 million, exceeding the high end of guidance, driven by additional pilot line expansion ...

Onto Innovation (ONTO) is set to report results for the second quarter of 2024 on Aug 8. The Zacks Consensus Estimate for second-quarter earnings per share (EPS) has been steady at $1.19 in the past 60 days, implying an increase of 50.6% from the year-ago quarter's figure. The company expects non-GAAP EPS in the range of $1.14-$1.26. Meanwhile, the consensus mark for revenues is pegged at $235.6 million, indicating a rise of 23.6% from the year-earlier quarter's actual. Management expects revenues in the ra ...

Shares of the maker of semiconductor manufacturing equipment witnessed a loss of 14.01% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 4.62% and the S&P 500's loss of 0.21%. For the annual period, the Zacks Consensus Estimates anticipate earnings of $5.05 per share and a revenue of $941.16 million, signifying shifts of +35.39% and +15.36%, respectively, from the last year. Our research suggests that these changes in estimates have a direct relationsh ...

The maker of semiconductor manufacturing equipment's stock has dropped by 2.26% in the past month, falling short of the Computer and Technology sector's gain of 0.47% and the S&P 500's gain of 1.96%. Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Onto Innovation. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the comp ...

Prior to today's trading, shares of the maker of semiconductor manufacturing equipment had gained 4.48% over the past month. This has outpaced the Computer and Technology sector's gain of 4.22% and the S&P 500's gain of 3.78% in that time. Any recent changes to analyst estimates for Onto Innovation should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's bu ...

While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us. It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Onto Innovation curre ...

The AICS market is rapidly evolving, with difficulties for organic substrate redistribution layers (RDLs) using copper clad laminate (CCL) below 3µm. This is forcing manufacturers to use glass, which is a more stable substrate. The pressing need for manufacturers to manage both large glass core panels and the existing mature CCL-based organic substrates is unlocking new market potential for lithography tools competent in handling both substrate types. Apart from the lithography challenges, the production of ...