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    AXCELIS TECHNOLOGIES (ACLS)

    ACLS Q2 2024: Silicon Carbide Demand Fuels 2025 $1.3B Revenue Goal

    Reported on Jun 23, 2025 (After Market Close)
    Pre-Earnings Price$112.82Last close (Aug 1, 2024)
    Post-Earnings Price$106.79Open (Aug 2, 2024)
    Price Change
    $-6.03(-5.34%)
    • Resilient Silicon Carbide Demand: Executives highlighted that silicon carbide remains a key growth driver with strong global demand, especially in China, which underpins a robust power segment and supports long‐term revenue growth.
    • Robust Evaluation-to-Order Pipeline: The Q&A emphasized successful conversion of evaluation units into firm orders and multiple ongoing evaluation programs, which signal a healthy future order pipeline and recurring revenue opportunities.
    • Healthy Backlog and Near-Term Upside: Discussions on a solid systems backlog with pull‐in activity and anticipated memory recovery in Q4 indicate potential for revenue step‐up in the near term, reinforcing a bullish outlook for 2025.
    • Memory Segment Weakness: The company recorded no memory systems revenue in Q2 and relies on a recover in DRAM and NAND, which remains uncertain given the current soft demand and reliance on future customer spending trends.
    • General Mature Slowdown: There are concerns over moderating spending in the General Mature segment due to macroeconomic headwinds and subdued consumer and industrial demand, which could weigh on revenue growth.
    • Dependence on One-Time Pull-In and Evaluation Conversions: Q2 results were boosted by pull-in activity and successful evaluation conversions; however, reliance on such one-time events raises the risk that recurring revenue may not sustain the current performance level.
    1. Revenue Guidance
      Q: Any changes since Capital Markets Day?
      A: Management maintains that full‐year revenue expectations remain in line with previous guidance. They noted some pull‐in activity in Q2 and stressed that reaching $1.3B in 2025 depends on a recovery in memory and general mature markets.

    2. Segment Trends
      Q: How are power segments performing?
      A: Leadership underscored robust Silicon Carbide performance while highlighting softness in Silicon IGBT. They pointed out that general mature outcomes will adjust with broader macro trends.

    3. Backlog Dynamics
      Q: Any notable backlog cancellations?
      A: Management explained that the decline in backlog resulted from the revenue load versus new bookings, with overall orders remaining healthy at around $1B.

    4. Q4 Revenue Drivers
      Q: Does flat Q3 guidance hide weaknesses?
      A: Executives expect a modest Q4 revenue uptick driven by resumed memory and image sensor orders, which should offset softness observed in non-China mature markets.

    5. Evaluation Pipeline
      Q: Impact and timing of evaluation unit pull-ins?
      A: Management noted strong conversion of evaluation units into firm orders and expects several sign-offs before year-end, reinforcing future demand.

    6. IGBT Dynamics
      Q: What drives IGBT softness?
      A: The team attributed IGBT softness to shifting market demand toward Silicon Carbide and competitive capacity expansions, though a modest recovery is anticipated over time.

    7. China Demand
      Q: How is regional performance, especially in China?
      A: Management highlighted that China remains the strongest region, contributing 55% of system sales, with consistently high silicon carbide demand bolstering growth.

    8. Japan Market Outlook
      Q: Is auto recovery needed for Japan progress?
      A: Executives indicated that progress in Japan, particularly in power and memory segments, is being driven by a comprehensive product portfolio and isn’t strictly tied to automotive recovery.

    Research analysts covering AXCELIS TECHNOLOGIES.