Third quarter 2026
Filed Nov 5, 2026Axcelis Announces Financial Results for Third Quarter 2026
Third-quarter revenue, GAAP net income and GAAP diluted earnings per share increased from the prior-year quarter, while GAAP and non-GAAP gross and operating margins declined. Management cited improving demand, record CS&I revenue and a strong increase in bookings, but identified foreign exchange headwinds on gross margin.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, three months ended September 30GAAP | $237.8M | – | – |
| Gross profit, three months ended September 30GAAP | $97.42M | – | – |
| Gross margin, three months ended September 30GAAP | 41.0% | – | – |
| Operating expenses, three months ended September 30GAAP | $70.08M | – | – |
| Research and development expense, three months ended September 30GAAP | $30.18M | – | – |
| Sales and marketing expense, three months ended September 30GAAP | $16.83M | – | – |
| General and administrative expense, three months ended September 30GAAP | $23.07M | – | – |
| Income from operations, three months ended September 30GAAP | $27.34M | – | – |
| Operating margin, three months ended September 30GAAP | 11.5% | – | – |
| Total other income, three months ended September 30GAAP | $8.66M | – | – |
| Income tax (benefit) provision, three months ended September 30GAAP | −$1.75M | – | – |
| Net income, three months ended September 30GAAP | $37.76M | – | – |
| Basic earnings per share, three months ended September 30GAAP | $1.22 | – | – |
| Diluted earnings per share, three months ended September 30GAAP | $1.21 | – | – |
| Non-GAAP gross profit, three months ended September 30non-GAAP | $98.03M | – | – |
| Non-GAAP gross margin, three months ended September 30non-GAAP | 41.2% | – | – |
| Non-GAAP operating income, three months ended September 30non-GAAP | $39.56M | – | – |
| Non-GAAP operating margin, three months ended September 30non-GAAP | 16.6% | – | – |
| Adjusted EBITDA, three months ended September 30non-GAAP | $44.05M | – | – |
| Adjusted EBITDA margin, three months ended September 30non-GAAP | 18.5% | – | – |
| Non-GAAP net income, three months ended September 30non-GAAP | $39.22M | – | – |
| Non-GAAP diluted earnings per share, three months ended September 30non-GAAP | $1.26 | – | – |
| Revenue, nine months ended September 30GAAP | $651.9M | – | – |
| Gross profit, nine months ended September 30GAAP | $269.2M | – | – |
| Income from operations, nine months ended September 30GAAP | $55.58M | – | – |
| Net income, nine months ended September 30GAAP | $70.26M | – | – |
| Diluted earnings per share, nine months ended September 30GAAP | $2.26 | – | – |
| Non-GAAP gross margin, nine months ended September 30non-GAAP | 41.6% | – | – |
| Non-GAAP operating income, nine months ended September 30non-GAAP | $94.40M | – | – |
| Non-GAAP operating margin, nine months ended September 30non-GAAP | 14.5% | – | – |
| Adjusted EBITDA, nine months ended September 30non-GAAP | $107.8M | – | – |
| Non-GAAP net income, nine months ended September 30non-GAAP | $94.61M | – | – |
| Non-GAAP diluted earnings per share, nine months ended September 30non-GAAP | $3.04 | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
Fourth quarter ending December 31, 2026 outlook
- Revenueapproximately $275 million
- NoteGAAP earnings per diluted share of approximately $1.15
- NoteNon-GAAP earnings per share of approximately $1.50
- NoteTransaction and Integration: $0.19
- NoteStock-based compensation: $0.22
- NoteIncome tax effect of non-GAAP adjustments: $(0.06)
Capital returns
- Repurchase of common stock: — for the three months ended September 30, 2026; $(32,335) for the three months ended September 30, 2025 (in thousands).
- Repurchase of common stock: — for the nine months ended September 30, 2026; $(95,850) for the nine months ended September 30, 2025 (in thousands).
What drove it
- Management said improving demand drove sequential growth in systems revenue.
- Management reported another quarterly record in CS&I and sustained strength in the CS&I business.
- Management cited a strong increase in bookings, continued momentum in Memory, and increasing activity in Power and General Mature.
- Management said stronger shipments and record CS&I revenue supported third-quarter results.
- The non-GAAP reconciliation includes transaction and integration costs associated with the merger agreement with Veeco Instruments announced on October 1, 2025.
Concerns
- GAAP gross margin was 41.0%, compared with 41.6% in the prior-year quarter, and non-GAAP gross margin was 41.2%, compared with 41.8%.
- GAAP operating margin was 11.5%, compared with 11.7%, and non-GAAP operating margin was 16.6%, compared with 18.2%.
- Management cited foreign exchange headwinds on gross margin.
- For the nine months ended September 30, GAAP income from operations was $55,575, compared with $83,143, while GAAP net income was $70,264, compared with $85,941 (in thousands).
- Inventory was $376,341 at September 30, 2026, compared with $329,010 at December 31, 2025 (in thousands).
- The safe harbor statement identifies risks including customer order and shipment timing, order conversion, semiconductor-equipment demand, competitive pressure on sales and pricing, production costs, tariffs and global economic, political or financial conditions.
What to watch
- Fourth-quarter revenue guidance of approximately $275 million.
- Fourth-quarter GAAP diluted EPS guidance of approximately $1.15 and non-GAAP EPS guidance of approximately $1.50.
- Whether the broadening recovery management described across Memory, Power and General Mature translates into shipments and revenue.
- Bookings, systems-revenue momentum and the continued performance of CS&I.
- Gross-margin effects from foreign exchange and the level of transaction and integration costs associated with the Veeco Instruments merger agreement.
Balance sheet and cash flow
- Cash and cash equivalents: $190,769 at September 30, 2026; $145,451 at December 31, 2025 (in thousands).
- Short-term investments: $281,588 at September 30, 2026; $228,802 at December 31, 2025 (in thousands).
- Long-term investments: $142,982 at September 30, 2026; $182,396 at December 31, 2025 (in thousands).
- Inventories, net: $376,341 at September 30, 2026; $329,010 at December 31, 2025 (in thousands).
- Accounts receivable, net: $154,713 at September 30, 2026; $168,479 at December 31, 2025 (in thousands).
- Total assets: $1,477,512 at September 30, 2026; $1,361,351 at December 31, 2025 (in thousands).
- Current portion of finance lease obligation: $1,799 at September 30, 2026; $1,575 at December 31, 2025 (in thousands).
- Long-term finance lease obligation: $39,367 at September 30, 2026; $40,754 at December 31, 2025 (in thousands).
- Total liabilities: $364,278 at September 30, 2026; $326,674 at December 31, 2025 (in thousands).
- Total stockholders’ equity: $1,113,234 at September 30, 2026; $1,034,677 at December 31, 2025 (in thousands).
- Net cash provided by operating activities: $40,221 for the three months ended September 30, 2026; $45,350 for the three months ended September 30, 2025 (in thousands).
- Net cash provided by operating activities: $76,733 for the nine months ended September 30, 2026; $124,872 for the nine months ended September 30, 2025 (in thousands).
- Expenditures for property, plant and equipment and capitalized software: $(2,504) for the three months ended September 30, 2026; $(2,015) for the three months ended September 30, 2025 (in thousands).
- Expenditures for property, plant and equipment and capitalized software: $(7,897) for the nine months ended September 30, 2026; $(8,960) for the nine months ended September 30, 2025 (in thousands).
- Net increase in cash, cash equivalents and restricted cash: $35,778 for the three months ended September 30, 2026; $13,847 for the three months ended September 30, 2025 (in thousands).
- Cash, cash equivalents and restricted cash at end of period: $201,407 at September 30, 2026; $195,127 at September 30, 2025 (in thousands).
Analysis
Axcelis reported third-quarter revenue of $237,781 (in thousands), compared with $213,611 (in thousands) in the prior-year quarter. GAAP net income was $37,759 (in thousands), compared with $25,986 (in thousands), and GAAP diluted earnings per share was $1.21, compared with $0.83. Management attributed the period to improving demand, stronger shipments, sequential systems-revenue growth and a quarterly record in CS&I, alongside a strong increase in bookings.
Profitability improved in absolute dollars but margins narrowed. GAAP gross margin was 41.0%, compared with 41.6%, and GAAP operating margin was 11.5%, compared with 11.7%. Non-GAAP gross margin was 41.2%, compared with 41.8%, while non-GAAP operating margin was 16.6%, compared with 18.2%. The company specifically cited foreign exchange headwinds on gross margin. Third-quarter GAAP operating expenses were $70,081 (in thousands), compared with $63,786 (in thousands), with research and development expense at $30,177 (in thousands), compared with $24,640 (in thousands).
The nine-month comparison remains softer than the third-quarter result. Revenue for the nine months ended September 30 was $651,912 (in thousands), compared with $600,718 (in thousands), but GAAP income from operations was $55,575 (in thousands), compared with $83,143 (in thousands), and GAAP net income was $70,264 (in thousands), compared with $85,941 (in thousands). Non-GAAP operating income was $94,404 (in thousands), compared with $108,441 (in thousands), and non-GAAP diluted EPS was $3.04, compared with $3.38.
Cash generation was positive, with net cash provided by operating activities of $40,221 (in thousands) in the third quarter and $76,733 (in thousands) for the nine months ended September 30. Cash and cash equivalents were $190,769 (in thousands), short-term investments were $281,588 (in thousands), and long-term investments were $142,982 (in thousands) at September 30, 2026. Inventory was $376,341 (in thousands), compared with $329,010 (in thousands) at December 31, 2025. The company reported no common-stock repurchases in either the third quarter or the first nine months of 2026.
For the fourth quarter ending December 31, 2026, Axcelis expects revenues of approximately $275 million, GAAP diluted EPS of approximately $1.15 and non-GAAP EPS of approximately $1.50. The guidance framework includes $0.19 for Transaction and Integration, $0.22 for stock-based compensation and $(0.06) for the income tax effect of non-GAAP adjustments. The key reported tension entering the fourth quarter is management’s demand and bookings momentum versus the margin pressure it attributed to foreign exchange.
Management, verbatim
We are pleased with our third quarter performance, as improving demand drove sequential growth in systems revenue, complemented by another quarterly record in CS&I. We are particularly encouraged by the strong increase in bookings, reflecting a broadening recovery across our end markets, with continued momentum in Memory and increasing activity in Power and General Mature. At the same time, we continue to see sustained strength in our CS&I business.
Russell Low, President and CEO
Our strategy of investing in next-generation technologies is beginning to yield tangible results and positions us well to capitalize on expanding market opportunities as customer investment recovers. We expect to finish 2026 with positive momentum and anticipate further growth in 2027.
Russell Low, President and CEO
Our third quarter results exceeded our expectations, supported by stronger shipments and record CS&I revenue, despite the impact from foreign exchange headwinds on our gross margin. We continue to generate healthy cash flow and maintain a strong balance sheet, providing us with ample financial flexibility. The combination of improving demand, a growing installed base and continued strength in CS&I provides a solid foundation as we enter 2027.
David Ryzhik, Senior Vice President and Interim CFO
Not in the filing
stated, not guessed- Prior-quarter figures and sequential percentage changes for the reported financial statement metrics.
- Revenue by operating segment or product category. The company stated that beginning in the third quarter of 2026 it will no longer separately present revenue and cost of revenue attributable to Services.
- Free cash flow.
- Dividend declaration or payment.
- Prior-quarter outlook for comparison with third-quarter actual results.
- Fourth-quarter gross margin, operating expenses and tax-rate guidance.
- A total debt balance other than current and long-term finance lease obligations.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.