Entegris 2025 Q1 Earnings Misses Targets as Net Income Rises 38.9%

Entegris (ENTG) reported its fiscal 2025 Q1 earnings on May 07th, 2025. Entegris missed Wall Street's revenue expectations for Q1 2025, with total sales of $773.20 million, which remained flat year-on-year. The company's guidance for the next quarter also fell short, projecting revenues between $735 million and $775 million, reflecting the uncertainty due to new tariffs affecting shipments to China. Despite these challenges, Entegris remains focused on strategic investments and maintaining profitability.

Revenue
Entegris experienced a modest increase in total revenue for Q1 2025, reaching $773.20 million compared to $771 million in Q1 2024. The performance was led by the Materials Solutions segment, contributing $341.40 million, while Advanced Purity Solutions added $433.90 million. The figures were adjusted slightly for inter-segment eliminations, resulting in the total revenue.

Earnings/Net Income
Entegris reported a significant increase in earnings per share (EPS) for Q1 2025, rising by 40% to $0.42 from $0.30 in the same quarter last year. The company's net income also showed remarkable growth, reaching $62.90 million, up 38.9% from the previous year's $45.30 million. The EPS growth reflects positively on the company's earnings performance.

Price Action
The stock price of Entegris edged up 0.66% during the latest trading day, has edged down 0.92% during the most recent full trading week, and has surged 19.88% month-to-date.

Post-Earnings Price Action Review
Over the past five years, the strategy of purchasing Entegris (ENTG) shares following a quarter where revenue decreased quarter-over-quarter and holding them for 30 days yielded no returns. This approach resulted in a 0.00% return, starkly contrasting with a benchmark return of 84.08%. Consequently, the excess return was -84.08%, and the strategy's compound annual growth rate (CAGR) also remained at 0.00%. The Sharpe ratio and maximum drawdown were both at 0.00%, indicating no risk or return was generated by this strategy. This lack of performance underlines the challenges faced by this particular investment approach.

CEO Commentary
Bertrand Loy, CEO of Entegris, reported that the company's first-quarter revenue grew 5% year-on-year, driven by an 8% increase in Materials Solutions sales and nearly 20% growth in CMP slurries and pads. He acknowledged challenges due to a sharp contraction in FOUPs and fluid handling revenue. Loy emphasized strategic investments in manufacturing facilities in Colorado and Taiwan, positioning the company to capitalize on its global manufacturing network. He expressed optimism about capturing incremental content per wafer as customer engagements progress, despite uncertainties from new tariff regimes affecting the semiconductor industry.

Guidance
Entegris provided a revenue guidance range for Q2 between $735 million and $775 million, reflecting uncertainty due to new tariffs impacting shipments to China. The company expects a gross margin of approximately 45% and GAAP EPS of $0.34 to $0.41 per share. Non-GAAP EPS is forecasted between $0.60 and $0.67 per share. Capital expenditures are projected to be approximately $300 million for 2025, reflecting a decrease from previous expectations.

Additional News
In recent weeks, Entegris has not announced any significant M&A activity, changes in C-level positions, or updates on dividend or buyback programs. The company continues to focus on its strategic investments in manufacturing capabilities and enhancing its global supply chain network. As the semiconductor industry navigates the challenges posed by new tariffs, Entegris remains committed to leveraging its technological expertise and customer relationships to drive long-term growth. The company's ongoing collaborations with customers on technology roadmaps and material innovations highlight its dedication to maintaining a competitive edge in the market.