Second Quarter 2026
Filed Aug 6, 2026Axcelis reported second-quarter revenue of $215.2 million, GAAP diluted EPS of $0.75, and non-GAAP diluted EPS of $1.06, while guiding third-quarter revenue to approximately $230 million.
Revenue, product revenue and services revenue were higher than the prior-year quarter, and management cited stronger system shipments and higher CS&I volume. However, GAAP and non-GAAP gross margins, operating margins, net income, adjusted EBITDA, and diluted EPS were below prior-year levels, while operating expenses increased.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenue (three months ended June 30, 2026; in thousands)GAAP | $ 215,175 | – | – |
| Product revenue (three months ended June 30, 2026; in thousands)GAAP | $ 200,488 | – | – |
| Services revenue (three months ended June 30, 2026; in thousands)GAAP | $ 14,687 | – | – |
| Gross profit (three months ended June 30, 2026; in thousands)GAAP | $ 91,189 | – | – |
| Gross margin (three months ended June 30, 2026)GAAP | 42.4 % | – | – |
| Non-GAAP gross profit (three months ended June 30, 2026; in thousands)non-GAAP | $ 91,944 | – | – |
| Non-GAAP gross margin (three months ended June 30, 2026)non-GAAP | 42.7 % | – | – |
| Total operating expenses (three months ended June 30, 2026; in thousands)GAAP | $ 70,908 | – | – |
| Research and development expense (three months ended June 30, 2026; in thousands)GAAP | $ 28,977 | – | – |
| Sales and marketing expense (three months ended June 30, 2026; in thousands)GAAP | $ 19,554 | – | – |
| General and administrative expense (three months ended June 30, 2026; in thousands)GAAP | $ 22,377 | – | – |
| Non-GAAP operating expense (three months ended June 30, 2026; in thousands)non-GAAP | $ 60,411 | – | – |
| Income from operations (three months ended June 30, 2026; in thousands)GAAP | $ 20,281 | – | – |
| Operating margin (three months ended June 30, 2026)GAAP | 9.4 % | – | – |
| Non-GAAP operating income (three months ended June 30, 2026; in thousands)non-GAAP | $ 31,533 | – | – |
| Non-GAAP operating margin (three months ended June 30, 2026)non-GAAP | 14.7 % | – | – |
| Income tax provision (three months ended June 30, 2026; in thousands)GAAP | $ 2,057 | – | – |
| Net income (three months ended June 30, 2026; in thousands)GAAP | $ 23,291 | – | – |
| Diluted earnings per share (three months ended June 30, 2026)GAAP | $ 0.75 | – | – |
| Non-GAAP net income (three months ended June 30, 2026; in thousands)non-GAAP | $ 32,968 | – | – |
| Non-GAAP diluted earnings per share (three months ended June 30, 2026)non-GAAP | $ 1.06 | – | – |
| Adjusted EBITDA (three months ended June 30, 2026; in thousands)non-GAAP | $ 35,972 | – | – |
| Adjusted EBITDA margin (three months ended June 30, 2026)non-GAAP | 16.7 % | – | – |
| Net cash provided by operating activities (three months ended June 30, 2026; in thousands)GAAP | $ 18,373 | – | – |
| Expenditures for property, plant and equipment and capitalized software (three months ended June 30, 2026; in thousands)GAAP | (3,554 ) | – | – |
| Repurchase of common stock (three months ended June 30, 2026; in thousands)GAAP | (244 ) | – | – |
| Total revenue (six months ended June 30, 2026; in thousands)GAAP | $ 414,131 | – | – |
| Net income (six months ended June 30, 2026; in thousands)GAAP | $ 32,505 | – | – |
| Diluted earnings per share (six months ended June 30, 2026)GAAP | $ 1.05 | – | – |
| Non-GAAP diluted earnings per share (six months ended June 30, 2026)non-GAAP | $ 1.78 | – | – |
| Net cash provided by operating activities (six months ended June 30, 2026; in thousands)GAAP | $ 36,512 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| ProductManagement cited stronger system shipments. | $ 200,488 | – | – |
| ServicesManagement cited higher CS&I volume and continued strength in its CS&I aftermarket business. | $ 14,687 | – | – |
Third quarter ending September 30, 2026 outlook
- Revenueapproximately $230 million
- NoteGAAP earnings per diluted share of approximately $0.76
- Notenon-GAAP earnings per share of approximately $1.11
- NoteTransaction and Integration: 0.19
- NoteStock-based compensation: 0.21
- NoteIncome tax effect of non-GAAP adjustments: (0.06 )
Capital returns
- Repurchase of common stock (three months ended June 30, 2026; in thousands): (244 )
- Repurchase of common stock (six months ended June 30, 2026; in thousands): (244 )
What drove it
- Management said second-quarter results exceeded its forecasts due to stronger system shipments and higher CS&I volume.
- Management said Memory demand remains robust.
- Management cited positive momentum in Power.
- Management cited improving engagement and utilization trends in General Mature as customers respond to growing end-demand in data center, industrial and automotive segments.
- Management expects year-over-year revenue growth in 2026, with momentum carrying through to 2027.
Concerns
- GAAP gross margin was 42.4 % versus 44.9 % in the prior-year quarter, and non-GAAP gross margin was 42.7 % versus 45.2 %.
- GAAP operating margin was 9.4 % versus 14.9 %, while non-GAAP operating margin was 14.7 % versus 17.7 %.
- GAAP net income was $ 23,291 versus $ 31,376, and GAAP diluted earnings per share was $ 0.75 versus $ 0.98.
- Total operating expenses were $ 70,908 versus $ 58,378, including general and administrative expense of $ 22,377 versus $ 16,311.
- Transaction and integration costs associated with the merger agreement with Veeco Instruments were $ 4,827 for the three months ended June 30, 2026.
What to watch
- Execution against third-quarter revenue guidance of approximately $230 million.
- Delivery against third-quarter GAAP diluted EPS guidance of approximately $0.76 and non-GAAP diluted EPS guidance of approximately $1.11.
- Whether Memory demand remains robust and Power momentum continues.
- Engagement and utilization trends in General Mature, including data center, industrial and automotive end-demand.
- Satisfaction of the remaining conditions and the expected second-half 2026 closing of the pending merger with Veeco.
Balance sheet and cash flow
- Cash and cash equivalents at June 30, 2026 (in thousands): $ 154,996
- Short-term investments at June 30, 2026 (in thousands): 247,220
- Long-term investments at June 30, 2026 (in thousands): 174,829
- Inventories, net at June 30, 2026 (in thousands): 338,174
- Accounts receivable, net at June 30, 2026 (in thousands): 154,149
- Current portion of finance lease obligation at June 30, 2026 (in thousands): 1,722
- Long-term finance lease obligation at June 30, 2026 (in thousands): 39,845
- Net cash provided by operating activities (three months ended June 30, 2026; in thousands): $ 18,373
- Net cash used in investing activities (three months ended June 30, 2026; in thousands): (6,097 )
- Net cash used in financing activities (three months ended June 30, 2026; in thousands): (7,852 )
- Cash, cash equivalents and restricted cash at end of period (three months ended June 30, 2026; in thousands): $ 165,629
Analysis
Axcelis reported second-quarter revenue of $ 215,175, compared with $ 194,544 in the prior-year quarter. Product revenue was $ 200,488 versus $ 183,402, while services revenue was $ 14,687 versus $ 11,142. Management attributed the result to stronger system shipments and higher CS&I volume, cited robust Memory demand and positive Power momentum, and said General Mature engagement and utilization trends were improving.
Profitability trailed the prior-year quarter despite the higher revenue base. GAAP gross margin was 42.4 % versus 44.9 %, and non-GAAP gross margin was 42.7 % versus 45.2 %. GAAP operating margin was 9.4 % versus 14.9 %, while non-GAAP operating margin was 14.7 % versus 17.7 %. Total operating expenses were $ 70,908, compared with $ 58,378, including $ 4,827 of transaction and integration costs associated with the Veeco merger agreement.
GAAP net income was $ 23,291 and GAAP diluted EPS was $ 0.75, compared with $ 31,376 and $ 0.98, respectively. Non-GAAP net income was $ 32,968 versus $ 36,013, and non-GAAP diluted EPS was $ 1.06 versus $ 1.13. Adjusted EBITDA was $ 35,972, with an adjusted EBITDA margin of 16.7 %, compared with $ 38,872 and 20.0 % in the prior-year quarter.
Cash generation was $ 18,373 of net cash provided by operating activities for the quarter, compared with $ 39,727. The company reported cash and cash equivalents of $ 154,996, short-term investments of 247,220, and long-term investments of 174,829 as of June 30, 2026. Repurchase of common stock was (244 ) during the quarter, compared with (45,337 ) in the prior-year quarter.
For the third quarter ending September 30, 2026, Axcelis expects revenues of approximately $230 million, GAAP earnings per diluted share of approximately $0.76, and non-GAAP earnings per share of approximately $1.11. Management also said it now expects to deliver year-over-year revenue growth in 2026, with momentum carrying through to 2027, while working to satisfy remaining conditions for its pending merger with Veeco and targeting a second-half 2026 close.
Management, verbatim
We executed well in the second quarter, delivering results that exceeded our forecasts driven by stronger system shipments and higher CS&I volume.
Russell Low, President and CEO
Demand in the Memory market remains robust, and we are also benefitting from positive momentum in our Power market.
Russell Low, President and CEO
Axcelis delivered better than expected revenue and operating income in our second quarter, reflecting the attractive operating leverage in our business.
David Ryzhik, Senior Vice President and Interim CFO
Not in the filing
stated, not guessed- Prior-quarter comparisons for reported second-quarter metrics were not provided.
- Percentage year-over-year and quarter-over-quarter changes for individual metrics were not provided.
- Free cash flow was not reported.
- A cash dividend was not reported.
- Formal operating segments, geographic revenue, backlog, bookings, and order metrics were not reported.
- Third-quarter guidance for gross margin and operating expenses was not provided.
- Third-quarter tax-rate guidance was not provided.
- Prior-period outlook was not provided; therefore, comparison of actual results with prior guidance is unavailable.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.