Veeco Instruments (VECO) Q4 2025 earnings summary

Executive summary

• Achieved record semiconductor revenue in 2025, driven by laser annealing, wet processing, and ion beam EUV technology, with Advanced Packaging business doubling year-over-year.

• Significant expansion in order activity for compound semiconductor and data storage customers, supporting strong growth in 2026.

• Announced an all-stock merger agreement with Axcelis Technologies, with shareholder and regulatory approvals progressing; expected to close in the second half of 2026.

• Multiple new product wins and ongoing evaluations at major DRAM and logic customers, fueling backlog growth, especially in AI and high-performance computing markets.

• Bookings accelerated in the second half of 2025, positioning for 2026 growth.

Financial highlights

• FY 2025 revenue was $664 million, down from $717.3 million year-over-year; Q4 revenue was $165 million, flat sequentially.

• Semiconductor business delivered $477 million in revenue, up 2% year-over-year and 72% of total revenue.

• FY 2025 gross margin was 41% non-GAAP (40% GAAP); Q4 gross margin was 37.7% non-GAAP (36.7% GAAP).

• FY 2025 non-GAAP operating income was $84 million; net income was $80 million; diluted EPS was $1.33.

• Order backlog at year-end was $555 million, up $145 million (35%) from the prior year.

Outlook and guidance

• FY 2026 revenue guidance: $740 million–$800 million, up 16% at midpoint; non-GAAP EPS: $1.50–$1.85.

• Gross margin expected between 40%–43% non-GAAP for 2026, with improvement in the second half.

• Net income projected at $94 million–$115 million; diluted EPS $1.50–$1.85.

• Q1 2026 revenue guidance is $150 million–$170 million; non-GAAP EPS: $0.14–$0.24.

• Fully booked for data storage system orders in 2026, with orders extending into 2027.