Mark Miller is a Senior Equity Research Analyst at The Benchmark Company, specializing in hardware technology with a focus on data storage, lasers, photonics, and semiconductor equipment. He covers notable firms such as Veeco Instruments, ACM Research, Electro Scientific, Newport Corp, Hutchinson Technology, FEI Company, Rofin-Sinar Technologies, Ultratech, and Uni-Pixel, and achieved a top rating return of over 410% on ACM Research, with an overall analyst success rate exceeding 52% based on TipRanks data. Miller began his equity research career after 25 years of technical industry experience at NASA-Goddard, 3M, Seagate, Control Data, and firms now part of Western Digital, and has held analyst positions at Nobel Capital Markets, Brean Murray Carrret, and Hoefer & Arnett before joining Benchmark; he is a three-time Wall Street Journal “Best on the Street” honoree and four-time awardee by StarMine, including #1 rankings. He holds a BS in physics from Johns Hopkins University, was a physics PhD candidate at the University of Maryland, and received his MBA from the University of Minnesota’s Carlson School of Management.
Mark Miller asked whether SanDisk believes it is gaining market share in the data center segment, given the strong sequential growth observed.
Chairman and CEO David Goeckeler confirmed that SanDisk believes it is growing faster than the overall data center market and expects this trend to continue throughout the fiscal year.
Mark Miller asked if Sandisk believes it is gaining market share in the data center segment, given the strong sequential growth observed.
Chairman and CEO David Goeckeler confirmed that Sandisk believes it is growing faster than the overall market in the data center segment and expects this trend to continue throughout the fiscal year.
Mark Miller of The Benchmark Company asked for specifics on which products are currently on allocation and whether there have been any major market share shifts in the data center segment.
EVP & CFO Luis Visoso stated that allocations are occurring across various products, particularly during the BIX-V to BIX-VIII transition. CEO David Goeckeler acknowledged some episodic quarterly share shifts among players but emphasized the broader market has absorbed these shipments, maintaining a favorable supply-demand balance.
Mark Miller asked if Seagate's HAMR drives have achieved parity in margins and yields with legacy PMR drives, and if not, when this parity is expected to occur.
Dave Mosley, Chair and CEO, stated that the 4-terabyte per platter HAMR product is still early in its lifetime, and the team is actively focused on improving its yields. This implies that HAMR yields and margins are not yet at parity with the highly mature legacy PMR drives.
Mark Miller asked if Seagate's HAMR drive margins and yields are at parity with legacy PMR drives, and when that parity is expected to occur.
Seagate's Chair and CEO, Dave Mosley, stated that the 4TB per platter HAMR product is still early in its lifetime, and the company is focused on aggressively improving its yields.
Mark Miller from The Benchmark Company asked about the impact of the new global minimum tax, specifically inquiring what the GAAP tax rate would be in relation to the guided 16% non-GAAP rate.
CFO Gianluca Romano stated that the GAAP tax rate will be very similar to the non-GAAP rate, as the global minimum tax affects both GAAP and non-GAAP calculations.
Mark Miller asked about any expected changes in data center CapEx from major hyperscale customers and inquired about any significant component sourcing from China.
CEO Dave Mosley stated that cloud customer demand has been predictable, with visibility extending into 2026, as storage is a critical part of their infrastructure. On sourcing, he noted that Seagate decoupled its supply chains long ago and has geographic options for components, resulting in minimal impact from any single region and allowing them to manage sourcing risks effectively.
Mark Miller of The Benchmark Company asked if AI-enabled PCs would drive a major hardware refresh cycle and when that might occur. He also requested the specific factory utilization percentage for Seagate's head and media fabs.
CEO Dave Mosley commented that while he has limited visibility, he believes the slow PC application space is about to change, driven by new creative and analytical tools, especially for video. He is excited about the potential but noted it's still very early to predict a timeline. Regarding utilization, Mosley stated that both head and media fabs are running at very high levels, over 90%, and the company intends to keep them that way to avoid negative cost implications.
Mark Miller of The Benchmark Company LLC asked about trends in the laser segment and whether MKS is seeing price increases from component suppliers due to tariffs.
President and CEO John Lee reported that the industrial laser market remains 'relatively muted' with no significant change from prior quarters, though he noted design wins in areas like HBM dicing. He also stated that MKS has not seen tariff-related price increases from suppliers, as they work collaboratively to mitigate such impacts.
Mark Miller of The Benchmark Company, LLC inquired about the impact of tariffs on the cost of components from suppliers. He also asked which of Veeco's equipment lines serves the quantum computing market.
CFO John Kiernan confirmed that tariffs on imported materials impacted gross margin by about 100 basis points in Q2 and a similar impact is expected in Q3. He added they are working to mitigate price increases from domestic suppliers. CEO William Miller specified that the quantum computing opportunity is primarily for their Molecular Beam Epitaxy (MBE) equipment.
Mark Miller asked for an outlook on second-half 2025 revenue, questioning if a flattish performance compared to the first half would be a reasonable assumption given market uncertainties. He also inquired about any improvements in tool utilization rates at data storage manufacturers.
CFO John Kiernan stated that while not providing specific guidance due to macro uncertainty, second-half 2025 business activity could be at a similar level to the first half, as strength in advanced semi is expected to offset China headwinds. CEO William Miller confirmed that tool utilization rates at data storage customers have been steadily picking up, driving service and spare parts revenue, although new system orders have not yet returned.
Mark Miller asked for an update on Veeco's business in high-bandwidth memory (HBM) and NAND, and later followed up on the status of its ion beam deposition systems for low-resistance films, including customer progress and order potential.
CEO William Miller explained that Veeco has no significant position in NAND but is qualified at one HBM customer and will begin an evaluation with a second in mid-2025. Regarding ion beam deposition, he stated that evaluations with two DRAM makers are ongoing and that a successful application win could represent $30 million to $40 million in follow-on orders.
Mark Miller asked about the potential impact of ASML's softer forecast on Veeco's EUV business and questioned the primary drivers for the expected decline in China revenue.
CEO William Miller stated that Veeco's outlook for its EUV systems remains stable at 3-5 systems for both 2024 and 2025, consistent with ASML's plans, and sees potential upside from new applications. Regarding China, Miller clarified the expected 2025 revenue decline is driven by the semiconductor market as customers digest recent capacity additions, rather than the EV market.
Mark Miller of The Benchmark Company LLC asked for the rationale behind the significant increase in long-term borrowings over the past six months.
CFO Mark McKechnie explained the increase was a strategic decision, partly related to capital use controls. Lisa Feng, CFO of the operating subsidiary ACM Shanghai, added that the company is leveraging the favorable interest rate spread between deposits and borrowings in China to maximize returns.
Mark Miller asked about the growth expectations for advanced packaging (AP) sales in 2025, requested a sales breakdown by end-markets like memory, logic, and electric vehicles, and sought confirmation on the revenue concentration from top customers.
Executive David Wang confirmed expectations for advanced packaging growth in 2025, highlighting contributions from 2.5D, 3D, and new panel-level packaging tools. CFO Mark McKechnie noted that the company does not provide a sales breakdown by end-market but suggested looking at the 10% customers as a proxy. David Wang also confirmed that the top four customers accounted for over 52% of revenue in 2024.
Mark Miller asked about the sustainability of gross margins above the target range into 2025 and questioned if sales outside of China are expected to increase significantly next year.
CFO Mark McKechnie stated that while recent gross margins have been strong due to product mix and foreign exchange, the company's long-term target remains 40-45%. He noted that backlog margins are healthy but did not provide 2025 guidance. On international sales, McKechnie and CEO David Wang confirmed it is a corporate focus, with significant customer interest in differentiated products like SAPS and Tahoe. They expect some contribution from non-China markets in 2025, supported by new facilities like the one in Oregon.
Mark Miller from The Benchmark Company LLC asked about any signs of double ordering from data center customers and whether an improving NAND market presents an opportunity for Advanced Energy.
President and CEO Steve Kelley stated they see no evidence of double ordering in data centers, only expedites due to strong underlying demand. He noted customers are cautious about building inventory. Regarding memory, he explained that AE is less exposed to NAND and is more excited about opportunities in leading-edge logic and DRAM, where its new products are gaining traction.
Mark Miller inquired about the margin profile of the company's backlog and new design wins. He also asked if management still sees a path to achieving a 40% gross margin trajectory by the end of the year.
CFO Paul Oldham explained that new products are expected to carry higher margins, and while data center margins are improving, they are not yet at the corporate average. He affirmed that despite tariff impacts, the company's gross margin goals are unchanged. The key drivers—factory consolidation, new product mix, and volume—remain on track, making the goal of approaching 40% gross margin by year-end still achievable.
Mark Miller of The Benchmark Company LLC asked for commentary on the welding market's performance outside of China, particularly in the U.S., and questioned if the margin profile of the current backlog was consistent with Q3 guidance.
CEO Mark Gitin confirmed that welding demand saw broad-based global growth. While China's EV sector was a primary driver, he noted quarter-over-quarter increases in other regions and with products like LightWELD. CFO Timothy Mammen affirmed that the product mix and margin profile of the company's backlog are in line with the assumptions used for the third-quarter financial outlook.
Mark Miller asked whether the noted market share gains in the electric vehicle (EV) sector were specific to China or were occurring globally. He also followed up on the demand outlook for North American EVs, given recent pullbacks by major automakers.
CEO Mark Gitin clarified that the specific share gains he highlighted were in China, driven by the company's differentiated subsystem combining its AMB laser, LDD monitoring, and scanning technology. He acknowledged that there has been uncertainty in the North American EV market for some time, describing it as a 'political hotbed' and difficult to predict.
Mark Miller of The Benchmark Company asked about measures being taken to improve margins beyond lower-cost lasers and the reasons for the decline in laser and non-laser system sales.
CFO Tim Mammen cited improved inventory control, efforts to reduce manufacturing under-absorption, and a favorable product mix as key margin drivers. CEO Mark Gitin added that investments in high-margin, differentiated areas like medical and micromachining will also boost margins over time. Tim Mammen attributed the system sales decline to the timing of large automation orders, noting the pipeline remains strong.
Mark Miller of The Benchmark Company asked about the potential impact and timing of China's stimulus programs on IPG's business and inquired about the company's current involvement in laser-based defense systems.
CFO Timothy Mammen and CEO Mark Gitin stated that while China's business environment has stabilized, it is too early to gauge the full impact of stimulus, though it could support EV adoption. Regarding defense, Mark Gitin confirmed that IPG continues to supply high-performance single-mode lasers into the global defense market for such applications, describing it as an ongoing, though not large, part of their business.
Mark Miller from The Benchmark Company LLC asked for a reconciliation between strong China EV sales and Axcelis's flat China revenue forecast, and between strong DRAM sales and Axcelis's muted memory segment results.
EVP & CFO James Coogan explained that both markets are in a digestion phase after significant capacity additions in 2024. Chinese customers are focusing on productivity, and memory customers are making only opportunistic buys rather than large capacity expansions. He reiterated that memory revenue will remain muted through 2025, though it should be up year-over-year.
Mark Miller requested an update on image sensor customers and asked why Axcelis is not seeing NAND demand despite reports of increasing industry CapEx in that segment.
CEO Russell Low explained that image sensor demand is regional, with one customer adding significant capacity while others remain quiet due to muted mobile and auto end markets. For NAND, he clarified that Axcelis's business is driven by new wafer starts, not just CapEx. The current industry focus is on increasing bit density by adding vertical layers, which does not increase the number of wafers requiring new implanters.
Mark Miller of The Benchmark Company asked for a breakdown of the projected higher OpEx in Q1 despite lower sales, specifically between SG&A and R&D.
EVP and CFO James Coogan explained the slight Q1 OpEx uptick is due to seasonal factors like payroll taxes, impacting all line items. For the full year, he expects R&D as a percentage of sales to be slightly higher than historically as the company invests through the downturn. President and CEO Russell Low emphasized this investment in R&D is a strategic opportunity to work with customers and develop new products to be ready for the next upturn.
Mark Miller asked for the specific hard drive Average Selling Price (ASP) for the quarter and the Days Sales Outstanding (DSO) metric.
VP of IR Ambrish Srivastava noted the company no longer discloses ASP per unit, focusing instead on exabytes. CFO Kris Sennesael added that the metric can be calculated and is trending up. Sennesael then provided the DSO figure, stating it was 52 days, a sequential improvement of 6 days.
Mark Miller of The Benchmark Company asked for the number of SanDisk shares Western Digital currently holds and whether plans for their disposition have changed.
CEO Irving Tan confirmed that Western Digital retains a 19.9% stake in SanDisk. He reiterated the company's plan, as outlined at its Investor Day, to sell these shares over an approximate 12-month period as a key part of its deleveraging strategy.
Mark Miller asked if Western Digital is observing across-the-board supply reductions from its NAND competitors and if there are any estimates on the magnitude of those cuts.
CEO David Goeckeler declined to comment on competitors' actions. He instead reiterated Western Digital's own strategy, consistent with its 'New Era of NAND' philosophy, which involves being disciplined with CapEx and actively managing its own supply to respond to market signals and support a balanced market.
Mark Miller asked for insight into the margin profile of the current backlog now that lower-margin orders have been worked through. He also requested specifics on which products are seeing strong AI-driven demand and asked for a breakdown of revenue from spares and services.
Robert Daigle (executive) confirmed that new bookings have margin profiles near historical levels, positioning the company for margin accretion as volumes recover, aided by a leaner cost structure. He specified that the strong AI-driven demand is for their reflow equipment used in advanced packaging, primarily within the Thermal Process Solutions business. Daigle clarified that spares and services constitute about 25% of the Thermal Process Solutions segment's revenue, while the Semiconductor Fab Solutions segment is currently almost exclusively consumables, parts, and service revenue due to weak equipment demand.
Asked about the outlook for cash flow generation, the reason for the recent decrease in cash, future gross margin expectations, and the normalized run rate for R&D expenses.
The cash decrease was due to a $4 million debt payoff, leaving the company debt-free. Future cash flow is expected to be positive, driven by operations and inventory reduction. Gross margins are projected to be slightly below Q4 levels in Q1 and then stabilize around 40% due to restructuring and cost savings. R&D expenses are expected to normalize to approximately $1 million per quarter after a timing-related increase in Q4.
Mark Miller from The Benchmark Company inquired about the recent decrease in cash, the outlook for cash flow generation, future gross margin expectations, and the reason for the increase in R&D spending during the quarter.
CFO Wade Jenke and CEO Robert Daigle clarified that the cash balance decreased primarily due to a strategic $4 million payment to eliminate all company debt. They expect future cash flow to be positive, driven by operations and inventory reduction. Regarding margins, Jenke projected Q1 margins to be slightly below Q4's level but to stabilize in the 40% range thereafter, aided by restructuring and outsourcing initiatives. He also explained that the Q4 R&D increase was due to timing, with costs pushed from Q3, and that spending should normalize to approximately $1 million per quarter.
Mark Miller asked for confirmation that the second half of the year is expected to be stronger than the first and inquired about the performance of the additive manufacturing business.
CFO Joe Corso confirmed the assumption that the second half will be stronger than the first. CEO Scott Keeney stated that while they are making good progress in additive manufacturing, their focus on U.S. and European customers means they are in markets with more limited growth compared to other global regions.
Mark Miller asked for confirmation that the second half of the year is expected to be stronger than the first half and inquired about the performance of nLIGHT's additive manufacturing business.
CFO Joe Corso confirmed the assumption that the second half of 2025 will be stronger than the first half is correct. CEO Scott Keeney stated that the company is making good progress in additive manufacturing but noted its focus is on U.S. and European customers, where market growth is more limited compared to other regions.
Sought confirmation on the stability of existing defense programs, inquired about the A&D mix and margin profile of the backlog, and asked about the potential timing for future orders related to the Stryker program.
The company confirmed its defense programs are stable and in priority areas. The backlog is predominantly A&D-related, with strong margins on the product side. Potential orders for the Stryker program could materialize within the next two years, contingent on the performance of initial deliveries.
Mark Miller asked for confirmation on the stability of existing defense programs, the composition and margin profile of the backlog, and the potential timing for orders related to the Stryker program.
CEO Scott Keeney confirmed that nLIGHT's business is well-aligned with areas of significant continuation and new defense efforts. CFO Joe Corso stated the vast majority of the backlog is A&D-related, with the product portion carrying 'very nice' gross margins and the development portion in the mid-to-high single digits. Keeney added that opportunities for Stryker program orders could emerge in the next two years, contingent on initial delivery performance.
Mark Miller asked about the drivers behind the weakness in low-power laser sales, the margin profile of the current backlog, and whether the conversion of backlog to revenue would be linear or lumpy.
CFO Joe Corso explained that low-power laser sales are largely tied to the additive manufacturing market. He stated the margin profile of the backlog is better than recently reported results, but absorption of fixed costs at current low revenue levels remains a challenge. Corso also clarified that backlog conversion to revenue is not linear, especially for large development programs, but the overall portfolio effect provides confidence in sequential A&D growth.
Mark Miller asked about the cause of weakness in low-power laser sales, the margin profile of the company's backlog, and whether the conversion of backlog to revenue would be linear.
CFO Joe Corso explained that the weakness in low-power lasers is primarily tied to the additive manufacturing market. He stated that the margin profile of the backlog is better than what has been recently reported, but overall margins are currently suppressed by poor fixed-cost absorption at low revenue levels. Corso clarified that backlog conversion is not linear, particularly for large development contracts like HELSI 2, which have lumpy revenue recognition patterns.
Mark Miller of The Benchmark Company asked if Nova expects increasing sales related to NAND as manufacturers boost CapEx. He also inquired about the margin profile of the company's current backlog.
Executive Gabriel Waisman expressed hope for a NAND-related revenue increase towards the end of the year, noting that current efforts are focused on technology evaluations to secure a strong position for the eventual ramp. Executive Guy Kizner confirmed that the margin profile of the backlog is more or less the same as what has been recently reported.
Mark Miller asked for clarification on which specific markets Nova is experiencing significant share gains and requested more detail on the composition of memory sales, particularly between HBM and NAND.
President and CEO Gabriel Waisman listed several areas of market share gains, including stand-alone OCD, front-end chemical metrology, and integrated metrology for advanced packaging. He also clarified that within the memory segment, DRAM was stronger than NAND, and HBM constituted the majority of the DRAM-related business with a higher growth rate.
Mark Miller asked for confirmation on the stability of existing defense programs, the composition and margin profile of the backlog, and the potential timing for Stryker program orders.
CEO Scott Keeney confirmed that nLIGHT's business is well-aligned with areas of continued government support and new efforts. CFO Joe Corso stated the vast majority of the backlog is A&D-related, with strong product margins and typical mid-to-high single-digit development margins. Keeney suggested that follow-on opportunities for the Stryker program could materialize in the next two years, contingent on initial delivery performance.
Mark Miller asked if the observed increase in NAND demand was a surprise and what the expectations are for that market in 2025. He also questioned if the recent large sequential increase in R&D spending would continue.
CEO Michael Plisinski admitted the NAND strength was 'a bit of a surprise' and is now a more meaningful part of the 2025 outlook, driven by high-stack 3D NAND ramps. Regarding R&D, both Plisinski and CFO Mark Slicer indicated that while another significant jump is not expected, an incremental increase is likely to meet customer demands for a higher pace of innovation.
Mark Miller asked for the company's revenue expectations from China and Korea for the upcoming year.
CEO Michael Plisinski stated that Korea is expected to benefit from the anticipated growth in the DRAM market. For China, he expects revenue to remain in the same 10% to 15% range as the business is already relatively de-risked in that region.
Inquired about the source of the Q2 revenue upside, order numbers and backlog, the proportion of upgrades that are HAMR-related, Q3 gross margin guidance, and cash from operations.
The Q2 revenue upside was due to pull-ins of HAMR and other upgrades, leading to a raised full-year outlook of nearly $45M. Orders in the quarter were just under $4M, with a backlog over $42M. The majority of upgrades are HAMR, but some recent ones are PMR. Q3 gross margin is guided to 37-39%. Net cash from operations was $6 million.
Inquired about the timing of revenue recognition for the first TRIO tool, sought confirmation on the number of TRIO tools expected to be recognized in 2024, and asked for more details on other ongoing TRIO evaluations.
Revenue for the first TRIO tool will be recognized upon customer acceptance, which is hoped to be completed within the quarter but is guaranteed for 2024. The company affirmed the guidance of recognizing 2-3 tools in the second half of the year. Regarding other evaluations, multiple samples are with potential customers, and the company hopes one of the 2-3 systems for the year will come from a new customer.
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