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- **Q3 2025 Strong Execution**: Revenue $166 million (+15% YoY), non-GAAP EPS $0.36, driven by AI/HPC demand and LSA/IBD EUV systems.
- **Axcelis Merger**: Pro forma SAM $5B; synergies include $900M combined cash, eval tools for NSA/IBD, and 2026 SAM growth in annealing ($1.3B), IBD ($500M), and packaging ($650M).
- **2026 Growth Drivers**: 300mm GaN orders, data storage equipment, and scientific market optical tools. Q4 2025 gross margin 37-39% (down due to eval tools and packaging mix).

**【CEO Summary Section】**
- Q3 2025 revenue: $166 million (vs. midpoint guidance of $160 million), non-GAAP EPS: $0.36 (vs. prior guidance of $0.28). Growth driven by AI and HPC demand, with LSA and IBD EUV systems as key contributors.
- Merger with Axcelis: Pro forma 2024 SAM exceeds $5 billion; synergies include expanded product portfolio (e.g., ion implantation + laser annealing), R&D scale, and regional penetration of Tier 1 customers. Combined cash: $900 million.
- Technology highlights: LSA evaluation system shipped to second Tier 1 DRAM customer; NSA systems being evaluated by 2 advanced logic customers for low thermal budget applications. IBD300 systems ordered by 2 DRAM customers for thin film properties.
- SAM projections: Annealing ($1.3B by 2029), IBD ($500M by 2029), advanced packaging ($650M by 2029).

**【CFO Financial Commentary】**
- Q3 2025: Gross margin 42% (high end of guidance), operating expenses $46 million (below guided range). Q4 2025 outlook: Revenue $155-175 million, gross margin 37-39% (down due to discounted eval tools and advanced packaging mix). 2026 growth drivers: 300mm GaN, Lumina+ platforms, and data storage orders.
- Balance sheet: Cash $369 million (up $14 million QoQ). 2026 revenue visibility: Data storage orders for ion beam and wet processing equipment (shipments H2 2026).

**【Q&A Key Highlights】**
- 300mm GaN adoption: Leading power IDM orders for data center applications, with pilot production in 2026 and ramp to HBM in 2027. GaN efficiency benefits for data centers.
- Gross margin guidance: Q4 2025 decline due to eval tool acceptances (e.g., LSA, micro LED) and advanced packaging mix. 2026 margin improvement expected with data storage and MOCVD orders.
- Advanced packaging: Business doubled in 2025; 2026 growth constrained by short lead times but sustained by wet processing and lithography orders for AI, automotive, and aerospace.


Veeco Instruments Inc. (VECO) Q3 2025 Earnings Call Transcript

Revenue

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VECO

VECO fundamentals

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