Veeco Instruments 2025 Q1 Earnings Misses Targets with 45.3% Net Income Decline

Veeco Instruments (VECO) reported its fiscal 2025 Q1 earnings on May 7, 2025. The company saw a 4.1% decrease in revenue to $167.29 million from $174.48 million in the same quarter last year. Net income fell sharply by 45.3% to $11.95 million from $21.85 million reported in Q1 2024. Despite these declines, Veeco's Semiconductor business showed growth, driven by advanced packaging. Looking forward, the company anticipates Q2 revenue between $135 million and $165 million, with GAAP EPS ranging from a loss of $0.05 to a profit of $0.17.

Revenue
In the first quarter of 2025, veeco instruments experienced a 4.1% decline in total revenue, bringing in $167.29 million compared to $174.48 million in the previous year. The Semiconductor division generated $123.82 million, while the Compound Semiconductor segment contributed $14.40 million. data storage saw revenues of $6.71 million, and Scientific & Other segments provided $22.37 million. This comprehensive report highlights the revenue contributions from each segment, reflecting a diverse performance across Veeco's business units.

Earnings/Net Income
Veeco Instruments' earnings per share (EPS) dropped by 46.2% from $0.39 in Q1 2024 to $0.21 in Q1 2025. The company's net income also decreased by 45.3% to $11.95 million from $21.85 million in the same period last year. These results indicate a challenging quarter for Veeco, with significant declines in both EPS and net income.

Price Action
The stock price of Veeco Instruments edged down 2.23% during the latest trading day, rose 1.02% over the most recent full trading week, and climbed 5.35% month-to-date.

Post-Earnings Price Action Review
The investment strategy of purchasing Veeco Instruments shares following a quarter-over-quarter revenue increase and holding for 30 days has underperformed significantly over the last five years. The strategy resulted in a negative return of -3.95%, starkly underperforming against a benchmark return of 84.08%. This underperformance reflects an excess return of -88.04% and a compound annual growth rate (CAGR) of -0.81%, indicating substantial losses. The approach also faced a maximum drawdown of -26.44% and had a Sharpe ratio of -0.05, highlighting considerable risk and negative returns during this period.

CEO Commentary
Veeco delivered solid results during the first quarter, including sequential and year-over-year growth in our Semiconductor business driven by growth in Advanced Packaging, commented Bill Miller, Ph.D., Veeco’s Chief Executive Officer. In addition, Veeco shared several exciting announcements, including receipt of Intel’s 2025 EPIC supplier award, new application wins in Laser Annealing, and new application wins in Wet Processing. Each reflects our continued execution and confidence that our long-term strategy can generate value for shareholders in the coming years.

Guidance
Revenue is expected in the range of $135 million to $165 million. GAAP diluted earnings (loss) per share are anticipated to fall between ($0.05) and $0.17. Non-GAAP diluted earnings per share are expected to be in the range of $0.12 to $0.32.

Additional News
Veeco Instruments recently announced a strategic partnership with a leading tech firm to advance semiconductor research and development. This collaboration aims to enhance the capabilities of Veeco's laser annealing technology, potentially opening new market opportunities. Additionally, the company appointed a new Chief Technology Officer, who will focus on driving innovation across Veeco's product lines. In other news, Veeco has initiated a share repurchase program valued at $50 million, reflecting management's confidence in the company's long-term growth prospects.

Ask Aime: How did Veeco Instruments' Q1 earnings perform?