MKS (MKSI) Down 6.8% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for MKS (MKSI). Shares have lost about 6.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is MKS due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent catalysts for MKS Inc. before we dive into how investors and analysts have reacted as of late.

MKS Earnings Miss Estimates in Q4, Revenues Increase Y/Y

MKS Inc. reported fourth-quarter 2025 adjusted earnings of $2.47 per share, which missed the Zacks Consensus Estimate by 1.59%. The figure increased 14.9% year over year.

Revenues of $1.03 billion beat the consensus mark by 1.2% and increased 10.5% year over year.

MKSI Q4 Top-Line Details

Product revenues (87.8% of total revenues) totaled $907 million, up 10.1% year over year. Services revenues (12.2% of total revenues) increased 13.5% year over year to $126 million.

Revenues from the Semiconductor market (42.1% of total revenues) increased 8.7% year over year to $435 million. Electronics & Packaging revenues (29.3% of total revenues) amounted to $303 million, up 19.3% year over year. Specialty Industrial revenues (28.6% of total revenues) rose 5% year over year to $295 million.

MKSI’s Q4 Operating Details

In the fourth quarter of 2025, the adjusted gross margin contracted 70 basis points (bps) on a year-over-year basis to 46.5%.

Adjusted EBITDA increased 5.1% year over year to $249 million. Adjusted EBITDA margin contracted 120 bps year over year to 24.1%.

Total operating expenses increased 8.7% year over year to $263 million in the reported quarter.

MKS reported a non-GAAP operating income of $217 million, up 9% year over year. The adjusted operating margin contracted 30 bps year over year to 21%

MKSI’s Balance Sheet

As of Dec. 31, 2025, MKS Instruments had cash and cash equivalents of $675 million compared with $697 million as of Sept. 30. As of Dec. 31, 2025, long-term debt totaled $4.15 billion.

Cash flow from operations was $142 million in the fourth quarter of 2025 compared with $197 million in the previous quarter.

The free cash flow was $91 million compared with $147 million in the fourth quarter of 2025.

MKSI’s Q4 Guidance

MKSI expects first-quarter 2026 revenues of $1.04 billion (+/- $40 million).

MKS anticipates a gross margin of 46% (+/- 1%). The company expects an adjusted EBITDA of $251 million (+/- 24 million).

On a non-GAAP basis, MKSI expects earnings of $2.00 (+/- 28 cents) per share

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in fresh estimates.

VGM Scores

At this time, MKS has a average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock has a score of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise MKS has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

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This article originally published on Zacks Investment Research (zacks.com).

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