Axcelis Technologies NASDAQ: ACLS reported first-quarter 2026 results that came in “slightly above our expectations,” according to President and CEO Russell Low, as the company pointed to strength in its customer support and installed base business and a meaningful uptick in memory demand.
The company also reiterated expectations for full-year 2026 revenue to be “relatively flat year-over-year,” while emphasizing improving trends in several end markets and a “return to growth in 2027,” Low said.
Leadership transition and merger-related limitations
Low opened the call by addressing a finance leadership change announced in March. Former Chief Financial Officer Jamie Coogan left Axcelis “to pursue an opportunity in the aerospace industry,” Low said, adding that David Rizik has stepped in as interim CFO. Low said Rizik has been “instrumental” in work tied to Axcelis’ pending merger with Veeco.
Rizik noted that, given the pending transaction, the company would not address questions related to the merger. Low said Axcelis continues to expect the Veeco merger to close in the second half of 2026, with regulatory approval from China’s State Administration of Market Regulation described as “the only approval remaining to close the transaction.”
First-quarter results and the impact of a customer settlement
For the first quarter, Axcelis posted revenue of $199 million and earnings per diluted share of $0.72, which Low said included a “one-time impact associated with a $5 million customer settlement.” Rizik quantified the settlement’s effect as a $5 million headwind to system revenue, roughly 70 basis points of gross margin pressure, and a $0.09 per-share EPS impact.
Rizik said quarterly revenue comprised approximately $126 million in system revenue and $73 million in CS&I revenue. He added that CS&I exceeded expectations, driven by service and consumables and “robust demand for system upgrades.” Low said CS&I revenue moderated sequentially but grew “more than 30% on a year-over-year basis,” attributing momentum to an expanded installed base, higher utilization rates, and product innovation.
On profitability, Rizik reported gross margin of 40.7%, below the company’s 41% outlook primarily due to the settlement. Operating expenses were $57.7 million, below the $59 million outlook, producing an operating margin of 11.7%. Adjusted EBITDA totaled $27.7 million for a 13.9% margin. Other income was $2.7 million, lower sequentially due to reduced interest income and foreign-exchange losses, while the tax rate was 14%.
Bookings, backlog, and regional mix
Rizik said bookings were “roughly flat on a sequential basis” at $128 million, while Low described bookings as consistent sequentially and the “second consecutive quarter of year-over-year growth on the trailing twelve-month basis.” The company exited the quarter with backlog of $453 million.
By geography, China rose to 40% of revenue, up from 32% in the prior quarter. Korea represented 28% of total revenue “as a result of higher memory sales,” Rizik said. Europe accounted for 16%, the United States 12%, Taiwan and Japan were 1% each, and the rest of world was 2%.
End-market commentary: memory strength, SiC signals, and general mature digestion
Low said sales to mature node applications represented the majority of system shipments, particularly in power and “general mature,” while memory shipments increased sequentially to the highest level since the fourth quarter of 2023.
In power, Low said silicon carbide shipments moderated sequentially, but he cited “encouraging demand signals” including stronger bookings and increased customer engagement on capacity plans and technology roadmaps. He highlighted discussions at SEMICON China around “super junction development and high energy implant requirements,” as well as customer focus on channeling capabilities and “the transition to 200 millimeters.” Low said end-market signals include increased silicon carbide penetration in electric vehicles, broader adoption across commercial goods such as HVAC and appliances, and interest tied to emerging AI data center opportunities for efficient power conversion.
Rizik reinforced the company’s view that utilization rates are improving, calling it “a really nice data point,” even as he said Axcelis still expects general mature to be down year-over-year in 2026. In response to a question about general mature demand, Rizik said the company feels “a little bit better today than we did 3 months ago,” while reiterating that quarter-to-quarter bookings can move around.
In general mature, Low said customers continue to manage capacity amid stabilizing automotive and recovering industrial volumes, along with growing demand tied to AI data centers. He also pointed to “continued improvement in spares and consumables” as a sign of higher tool utilization. Low added that Axcelis introduced its next-generation high current product, the Purion H6, and is engaging multiple customers, including securing “a high current win with a new customer in China.”
In advanced logic, Low said the company did not generate system revenue in the first quarter, but shipped a system early in the second quarter for a materials modification application for 2-nanometer production and is working with the customer on next-generation roadmaps.
In memory, Low said revenue and bookings increased “meaningfully” in the first quarter, driven by demand in DRAM and high bandwidth memory as customers invest in capacity to support AI-driven requirements. He said Axcelis expects “strong growth in memory for full year 2026, with momentum entering into 2027.” Addressing quarterly variability, management said memory will be “a little softer sequentially” in the second quarter, and that the company’s 2026 expectations assume “not much NAND,” with Rizik noting that vertical scaling in NAND “doesn’t require a lot of incremental implant” until wafer additions increase.
Second-quarter and full-year outlook
For the second quarter, Rizik guided to revenue of approximately $205 million. He said the company expects a higher mix from general mature, offset by lower mix from memory and silicon carbide. Gross margin is expected to be approximately 43%, with sequential improvement attributed to more favorable mix and “the absence of non-recurring items” from the first quarter. Operating expenses are projected at about $59 million, adjusted EBITDA around $34 million, and net earnings per diluted share approximately $0.90.
For the full year, Axcelis maintained its view that 2026 revenue will be approximately flat versus 2025 and “second half-weighted,” driven by improved silicon carbide revenue and continued memory strength. Rizik reiterated expectations for full-year gross margins in the low-to-mid 40% range with quarterly variability, operating expenses of about $60 million per quarter for the balance of the year, and a tax rate of approximately 15%.
About Axcelis Technologies NASDAQ: ACLS
Axcelis Technologies, Inc is a leading developer and manufacturer of ion implantation and cleaning equipment used in the fabrication of semiconductor chips. The company specializes in high-current, medium-current and high-energy ion implantation systems, which are critical for introducing precisely controlled dopants into silicon wafers. Axcelis also offers plasma-based cleaning and dry strip tools that support advanced process nodes in logic, memory and power device manufacturing.
The company's product portfolio encompasses single-wafer and multi-wafer cluster tools designed to deliver high throughput, accuracy and uniformity for semiconductor process steps.
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