Vedvati Shrotre

Vedvati Shrotria sought clarification on whether the merchant GPU win would influence the first-half versus second-half dynamics of 2026 revenue and if it's incorporated into the new target model. She also asked about the potential for the Robotics business to exceed breakeven revenues, driven by the large e-commerce program.

Answer

CEO Greg Smith confirmed that a significant merchant GPU ramp would impact the second half of 2026 and is included in the $6 billion target model, though it assumes incremental share gains over years, not a radically high initial share. For Robotics, he stated the goal is breakeven for 2026, with the large e-commerce customer's revenue expected to triple between 2025 and 2026, and grow substantially post-2026, contributing positively beyond 2026.

Vedvati Shrotria sought clarification on whether the merchant GPU win impacts second-half versus first-half dynamics and if it's included in the new target model. She also asked if the ramping large e-commerce program in robotics could lead to revenues exceeding the breakeven point for that business.

Answer

CEO Greg Smith confirmed that a significant merchant GPU ramp would impact the second half and is part of the $6 billion target model, though it assumes an incremental, not radically high, share gain over years. For robotics, Greg Smith stated the goal is breakeven this year, with the large e-commerce customer's revenue expected to triple between 2025 and 2026, growing substantially post-2026, positioning the business to contribute positively beyond 2026.

Vedvati Shrotre asked for clarification on the adoption of HBM singulated die testing, inquiring if it's becoming a norm and if all suppliers are expected to adopt it. She also sought color on the proportion of compute within SoC revenue in the second half of 2025 and how the 2028 model composition might shift given compute's strong driver status.

Answer

CEO Greg Smith clarified that only one major manufacturer is routinely performing singulated stack HBM testing, and its broader proliferation depends on significant downstream yield improvements. CFO Sanjay Mehta stated that compute (VIP and networking) is a 'very significant component' of the second half business. Mr. Smith added that AI-driven segments (memory and SoC compute) accounted for 50% of total revenue in Q3 and are projected to be 60% in Q4, indicating a 'very different composition of business.' He confirmed the long-term model update in January would reflect a much heavier weighting on compute and AI-driven memory.

Vedvati Shrotre asked about HBM, specifically the new singulated die test insertion and Q3 volume shipments, inquiring if this is becoming the norm, if it increased demand, and if all suppliers are expected to adopt it. She also asked for color on how much compute is part of SoC in the second half of 2025, and if current data suggests compute is a stronger driver than the analyst day projection of one-third mobility, one-third compute, and one-third auto industrial for 2028.

Answer

CEO Greg Smith clarified that only one major manufacturer is routinely performing singulated stack HBM testing, and its proliferation depends on significant downstream yield improvement. CFO Sanjay Mehta stated that the second half business is very strongly driven by compute (VIP and networking). Mr. Smith added that AI-driven segments accounted for 50% of Q3 total revenue, rising to 60% in Q4, confirming a significant shift in business composition and indicating the updated long-term model in January will heavily weight compute and AI-driven memory.

Vedvati Shrotre asked about the expected financial contribution and margin profile of the recent Sentronics acquisition, and whether Nova could quantify the revenue potential from its new chemical metrology facility.

Answer

President and CEO Gabriel Waisman noted that Sentronics' Q1 revenue is included in the forecast and that the company is well-positioned in a growing market. CFO Guy Kizner added that Sentronics aligns with Nova's financial model and is expected to be accretive within 12 months. Regarding the new facility, Waisman stated it provides capacity for future growth without providing a specific revenue figure.

Vedvati Shrotre asked about the key investment drivers and technology inflections in the memory space that benefit Nova. She also questioned if the trajectory to the $500 million GAA revenue target by 2026 has changed due to reported customer issues. Lastly, she inquired about Nova's China exposure outlook for 2025 compared to peers who are reducing theirs.

Answer

Gabriel Waisman, executive, identified current memory demand as being driven by DRAM, particularly for high-bandwidth memory (HBM) applications. He anticipates DRAM demand will grow more in the first half of 2025, with a NAND recovery in the second half. Waisman firmly stated there is no change to the $500 million GAA revenue forecast by 2026, expressing confidence in Nova's strong position. Regarding China, he reiterated that demand remains robust, but its overall share of sales will naturally moderate as advanced node business accelerates in other regions.

Vedvati Shrotre asked how TSMC's plan to double advanced packaging CapEx would affect the linearity of Onto's 2.5D integration revenue. She also questioned if Onto's offering changes significantly between CoWoS-L and CoWoS-S technologies.

Answer

CEO Michael Plisinski explained that when a customer doubles capacity, process control tools are typically front-loaded to qualify new equipment, and he expects this to apply to 2.5D packaging. He also noted that new applications being qualified could increase capital intensity further. He stated there are no significant differences in their offering for CoWoS-L versus CoWoS-S.

Vedvati Shrotre asked for an update on the $120 million volume purchase agreement (VPA) for gate-all-around, visibility into 2025 HBM capacity additions, and the size of the power semiconductor opportunity given the auto market downturn.

Answer

CEO Michael Plisinski stated that visibility on the VPA remains strong across both customers involved, with a significant portion remaining for 2025. He acknowledged that HBM expansion plans appear muted for now but expects an increase will be necessary to support logic growth. For power semiconductors, Plisinski explained that record revenue is driven by customers' focus on improving yields during wafer size transitions, making it the second-largest market within the specialty and advanced packaging segment.

Vedvati Shrotre questioned the change in the full-year HPC contribution forecast from a 50-60% range to 50%. She also asked about the impact of the transition to HBM3E/HBM4 on inspection intensity and the competitive landscape in Korea.

Answer

Executive Ramy Langer clarified that the 50% HPC contribution is based on a higher total revenue forecast, meaning the absolute dollar amount for HPC remains on target. He noted that higher HBM stacks require more wafer scans, which is positive for business. He also stated that Camtek remains a main player in Korea, alongside Onto and KLA, without seeing significant new local competition.