Axcelis(ACLS) - 2023 Q3 - Quarterly Report

Revenue Performance - Total revenue for the three months ended September 30, 2023, was $292.3 million, a 27.6$229.2 million in the same period of 2022[76] - Product revenue was $283.4 million, representing 96.9$221.5 million in the prior year[77] - Services revenue increased to $9.0 million, or 3.1$7.6 million, or 3.3% of total revenue, in the same period last year[81] - Total revenue for the nine months ended September 30, 2023, was $820.3 million, a 25.4$653.9 million in the same period of 2022[76] - The company's ten largest customers accounted for 55.1% of total revenue for the nine months ended September 30, 2023[70] Profitability Metrics - Gross profit for the three months ended September 30, 2023, was $129.7 million, a 25.5$103.3 million in the same period of 2022[86] - The gross margin for product revenue was 45.4% for the three months ended September 30, 2023, down from 46.3% in the same period of 2022[86] - Gross margin from product revenue decreased to 44.1% for the nine months ended September 30, 2023, down from 45.8% in the same period of 2022[89] - Gross margin from services revenue decreased to 10.6% for the nine months ended September 30, 2023, compared to 12.1% for the same period in 2022[89] - The company reported an income before income taxes of 25.2% for the three months ended September 30, 2023, compared to 19.6% in the same period of 2022[75] Expenses Overview - Research and development expenses increased by 28.0% to $72.0 million for the nine months ended September 30, 2023, compared to$56.3 million in the same period of 2022[94] - Sales and marketing expenses rose by 19.7% to $46.1 million for the nine months ended September 30, 2023, compared to$38.6 million in the same period of 2022[96] - General and administrative expenses increased by 17.9% to $48.5 million for the nine months ended September 30, 2023, compared to$41.2 million in the same period of 2022[98] - Total operating expenses for the nine months ended September 30, 2023, were $166.7 million, representing 20.3$136.0 million, or 20.8% of revenue, in the same period of 2022[90] - Personnel costs accounted for 59.6% of total operating expenses for the nine months ended September 30, 2023, compared to 61.0% in the same period of 2022[91] Cash Flow and Investments - Operating cash flow for the nine months ended September 30, 2023, was $91.3 million, compared to$93.2 million for the same period in 2022[105] - Cash outflows from investing activities for the nine months ended September 30, 2023, totaled $74.2 million, including$10.5 million for capital expenditures and $271.6 million for short-term investments[106] - Cash outflows from investing activities for the nine months ended September 30, 2022, were$40.5 million, with $6.9 million for capital expenditures[106] - Financing activities for the nine months ended September 30, 2023, resulted in cash usage of$53.2 million, with $37.5 million used for stock repurchases[107] - Financing activities for the nine months ended September 30, 2022, resulted in cash usage of$53.1 million, with $45.0 million for stock repurchases[107] Financial Position - The company had$142.3 million in unrestricted cash and cash equivalents and $318.7 million in short-term investments as of September 30, 2023[104] - The company believes its existing cash and cash equivalents will be sufficient to meet anticipated cash requirements for both the short- and long-term[111] - As of September 30, 2023, a letter of credit of$5.9 million remains outstanding, securing the lease on the corporate headquarters[111] - The company terminated its Senior Secured Credit Facilities Credit Agreement on April 5, 2023, which had a revolving credit facility of up to $40.0 million[108] Other Financial Information - Other income was$2.0 million for the three months ended September 30, 2023, compared to an expense of $8.2 million in the same period of 2022, marking a$10.2 million change[100] - Income tax provision increased by 63.9% to $7.7 million for the three months ended September 30, 2023, compared to$4.7 million in the same period of 2022[101] - 94% of shipments during the first nine months of 2023 were to mature foundry/logic customers, indicating a strong demand in this segment[71] - There have been no material changes to market risk disclosures as of September 30, 2023[113] - Significant commitments and contingencies as of September 30, 2023, are consistent with previous disclosures[112]