Axcelis Announces Financial Results for Third Quarter 2023

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Nov 01, 2023, 16:01 ET

Financial Results Continue to be Driven by Strong Purion Demand in the Global Silicon Carbide Power Device Market

BEVERLY, Mass., Nov. 1, 2023 /PRNewswire/ -- Axcelis Technologies, Inc. (Nasdaq: ACLS) today announced financial results for the third quarter of 2023.

Highlights include:

The Company reported third quarter revenue of $292.3 million, compared to $274.0 million for the second quarter of 2023.
Operating profit for the quarter was $71.7 million, compared to $63.7 million for the second quarter.
Net income for the quarter was $65.9 million, or $1.99 per diluted share, compared to $61.6 million, or $1.86 per diluted share in the second quarter.
Gross margin for the quarter was 44.4%, compared to 43.7% in the second quarter.
Third quarter ended with systems backlog of $1.2 billion on quarterly bookings of $198 million.

President and CEO Russell Low commented, "Axcelis delivered strong third quarter financial performance due to robust demand for the Purion product family, especially in the silicon carbide power market. Axcelis is the only company with a product line that can deliver complete recipe coverage for all power device applications. We are the technology leader and the supplier of choice providing the best device manufacturing capabilities. This uniquely positions Axcelis to benefit from high growth in this market. Axcelis expects to achieve revenue of greater than $1.1 billion in 2023."

Executive Vice President and Chief Financial Officer James Coogan said, "We are very pleased with our third quarter 2023 financial results. Revenue, EPS and gross margins all finished well above guidance. Axcelis has had the rare opportunity to grow revenue 20% year over year as well as improve profitability during a significant industry downturn. This is a result of strong product positioning and continued strong execution in a challenging environment."

Business Outlook
For the fourth quarter ending December 31, 2023, Axcelis expects revenues of approximately $295 million. Gross margin in the fourth quarter is expected to be approximately 45%. Fourth quarter operating profit is forecast to be approximately $73 million with earnings per diluted share of approximately $2.00. For the full year, the Company expects to achieve revenue of greater than $1.1 billion and to achieve full year gross margins of approximately 43.6% as shown in the $1.1 billion model.

Third Quarter 2023 Conference Call
The Company will host a call to discuss the results for the third quarter on Thursday, November 2, 2023, at 8:30 a.m. ET. The call will be available to interested listeners via an audio webcast that can be accessed through the Investors page of Axcelis' website at www.axcelis.com, or by registering as a Participant here: https://register.vevent.com/register/BI1a199f2035664eafaa3226da79b560e5. Webcast replays will be available for 30 days following the call.

Safe Harbor Statement
This press release and the conference call contain forward-looking statements under the Private Securities Litigation Reform Act safe harbor provisions. These statements, which include our expectations for revenues, gross margin, operating profit and other guidance for our future financial performance and spending in our industry, are based on management's current expectations and should be viewed with caution. They are subject to various risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements, many of which are outside the control of the Company, including that customer decisions to place orders or our product shipments may not occur when we expect, that orders may not be converted to revenue in any particular quarter, or at all, whether demand will continue for the semiconductor equipment we produce or, if not, whether we can successfully meet changing market requirements, and whether we will be able to maintain continuity of business relationships with and purchases by major customers. Increased competitive pressure on sales and pricing, increases in material and other production costs that cannot be recouped in product pricing and instability caused by changing global economic, political or financial conditions could also cause actual results to differ materially from those in our forward-looking statements. These risks and other risk factors relating to Axcelis are described more fully in the most recent Form 10-K filed by Axcelis and in other documents filed from time to time with the Securities and Exchange Commission.

About Axcelis:
Axcelis (Nasdaq: ACLS), headquartered in Beverly, Mass., has been providing innovative, high-productivity solutions for the semiconductor industry for over 45 years. Axcelis is dedicated to developing enabling process applications through the design, manufacture and complete life cycle support of ion implantation systems, one of the most critical and enabling steps in the IC manufacturing process. Learn more about Axcelis at www.axcelis.com.

Company Contacts

Investor Relations:
Doug Lawson
978.787.9552

Editorial/Media:
Maureen Hart
978.787.4266

Axcelis Technologies, Inc. Consolidated Statements of Operations (In thousands, except per share amounts) (Unaudited)

	Three months ended				Nine months ended
		September 30,			September 30,
	2023		2022		2023		2022
Revenue:
Product	$	283,367	$	221,540	$	795,047	$	631,998
Services		8,959		7,635		25,269		21,949
Total revenue		292,326		229,175		820,316		653,947
Cost of revenue:
Product		154,798		118,992		444,311		342,387
Services		7,844		6,862		22,600		19,291
Total cost of revenue		162,642		125,854		466,911		361,678
Gross profit		129,684		103,321		353,405		292,269
Operating expenses:
Research and development		24,093		20,563		71,996		56,267
Sales and marketing		16,465		14,573		46,146		38,567
General and administrative		17,446		14,983		48,519		41,163
Total operating expenses		58,004		50,119		166,661		135,997
Income from operations		71,680		53,202		186,744		156,272
Other income (expense):
Interest income		4,580		1,111		12,824		1,558
Interest expense		(1,325)		(1,333)		(4,027)		(4,101)
Other, net		(1,260)		(7,971)		(4,348)		(14,640)
Total other income (expense)		1,995		(8,193)		4,449		(17,183)
Income before income taxes		73,675		45,009		191,193		139,089
Income tax provision		7,744		4,726		15,986		13,002
Net income	$	65,931	$	40,283	$	175,207	$	126,087
Net income per share:
Basic	$	2.01	$	1.22	$	5.35	$	3.81
Diluted	$	1.99	$	1.21	$	5.28	$	3.75
Shares used in computing net income per share:
Basic weighted average shares of common stock		32,807		33,011		32,775		33,116
Diluted weighted average shares of common stock		33,159		33,389		33,208		33,638

Axcelis Technologies, Inc. Consolidated Balance Sheets (In thousands, except per share amounts) (Unaudited)

	September 30,		December 31,
	2023		2022
ASSETS
Current assets:
Cash and cash equivalents	$	142,300	$	185,595
Short-term investments		318,710		246,571
Accounts receivable, net		192,327		169,773
Inventories, net		312,223		242,406
Prepaid expenses and other current assets		49,481		33,300
Total current assets		1,015,041		877,645
Property, plant and equipment, net		47,169		39,664
Operating lease assets		31,082		12,146
Finance lease assets, net		16,981		17,942
Long-term restricted cash		6,650		752
Deferred income taxes		44,323		31,701
Other assets		40,448		33,791
Total assets	$	1,201,694	$	1,013,641
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	60,061	$	62,346
Accrued compensation		26,535		35,540
Warranty		11,464		8,299
Income taxes		582		4,304
Deferred revenue		148,299		123,471
Current portion of finance lease obligation		1,438		1,229
Other current liabilities		12,799		12,943
Total current liabilities		261,178		248,132
Long-term finance lease obligation		44,070		45,185
Long-term deferred revenue		53,730		31,306
Other long-term liabilities		41,745		21,762
Total liabilities		400,723		346,385

Stockholders' equity:
Common stock, $0.001 par value, 75,000 shares authorized; 32,772 shares issued and outstanding at September 30, 2023; 32,775 shares issued and outstanding at December 31, 2022		33		33
Additional paid-in capital		543,577		550,299
Retained earnings		261,521		118,892
Accumulated other comprehensive loss		(4,160)		(1,968)
Total stockholders' equity		800,971		667,256
Total liabilities and stockholders' equity	$	1,201,694	$	1,013,641