Axcelis Technologies, Inc.

the company's results for the first quarter 2025. My name is Sean Otmer, and I will be your coordinator for today. I would now like to turn the presentation over to your host for today's call, David Ryjic, Senior Vice President of Investor Relations and Corporate Strategy. Please proceed.

Thank you, operator. This is David Ryjic, Senior Vice President of Investor Relations and Corporate Strategy. And with me today is Russell Lowe, President and CEO and Jamie Coogan, Executive Vice President and CFO. If you have not seen a copy of our press release issued earlier today, it is available on our website. In addition, we have prepared slides to accompany today's call, and you can find those on our website as well. Playback service will also be available on our website as described in our press release. Please note that comments made today about our expectations for future revenues, profits, and other results are forward-looking statements under the SEC's Safe Harbor provision. These forward-looking statements are based on management's current expectations and are subject to the risks inherent in our business. These risks are described in detail in our Form 10-K Annual Report and other SEC filings, which we urge you to review. Our actual results may differ materially from our current expectations. We do not assume any obligation to update these forward-looking statements. As we mentioned on our previous earnings call, we have decided to add non-GAAP measures to our first quarter results and those going forward. As a result, during this call, we will be discussing various non-GAAP financial measures. Please refer to our press release and accompanying materials for information regarding our non-GAAP financial results and a reconciliation to our GAAP measures. Now I'll turn the call over to President and CEO, Russell Lowe. Russell?

Good morning and thank you for joining us for our first quarter 2025 earnings call. Beginning on slide number four, we executed well during the first quarter with revenue of $193 million and earnings per diligent share of 88 cents, both exceeding our outlook with particular strength in our gross margins and discipline cost control. On a non-GAAP basis, we delivered earnings per share of $1.04. Jamie will discuss our financial results in further detail, including non-GAAP measures, which we're introducing today. Within overall revenue, both systems and CSMI sales were slightly better than our expectations. In the first quarter, we generated $110 million in bookings, reflecting a sequential increase compared to fourth quarter levels. This translates into a book-to-bill of 0.8 times the highest level we've seen since Q4 of 2023. While we're encouraged by the improvement in bookings in the first quarter, we believe bookings can fluctuate from quarter to quarter as we move through 2025. Before I turn to providing more detail on the trends we're seeing by market segment, I'd like to touch on the global tariff situation and how this impacts Exelis. To date, while the tariff and macroeconomic environment is dynamic, Excellus has not seen any meaningful change in demand from our customers as a result of the announced tariffs. Moreover, Excellus has plans in place to lessen the direct tariff impact. From a supply chain perspective, as many of you know, Excellus possesses a global supply base with partners inside and outside of the United States. And over the past several years, we've made significant progress in diversifying our supply chain to drive better resilience in our sourcing. From a manufacturing perspective, our corporate headquarters and primary manufacturing facility is located in Massachusetts. However, several years ago, we invested in a new Asian operations center capable of supporting our global customers. Our locations and facilities allow us to be highly adaptive to the rapidly changing policy environment. We are executing well in developing solutions so we can continue to support our customers across the world, lessen the impact associated with the tariffs to support our gross margin goals, while maintaining our focus on innovation to capture long-term growth opportunities that lie ahead. With that, let me add some additional color on the trends we're seeing by market segments. Turning to slide five, in the quarter, sales to mature node applications remain the lion's share of our business. in particular, power and general mature. As we noted on fourth quarter earnings call, beginning with first quarter results, ship system sales to the image sensor market will now be included in our overall general mature category to simplify our disclosure. Now, on slide six, let me review our trends by end market. Within our power business, shipments of silicon carbide applications declined sequentially in the quarter, consistent with expectations as customers are moderating investments due to softer end demand. From a regional perspective, we are seeing continued pockets of investment in China, while the rest of the world is managing through a broader digestion of capacity. While companies in China have made significant progress with the production of silicon carbide wafers, We believe our customers are earlier in their journey on silicon carbide device manufacturing, where ion implantation is foundational. In fact, on a global basis, despite an overall moderation of investments into silicon carbide, we're seeing strong engagement in technology transitions which includes increased customer pool for us to support them in the transition from 150 to 200 millimeter wafers, as well as the transition from planar to trench device architecture, and also growing collaboration on super junction devices. All these trends play to Xelta's core strengths. We are the market leader on implantation for silicon carbide with the largest install base and extensive application know-how. We're also the global market leader in high-energy implant, which is increasingly relevant for next-generation device architectures in silicon carbide. And finally, we have robust product and service upgrade offerings that allow customers to enhance their solutions to the latest generation of implant technology within the existing factory footprint. And this is a key driver for long-term growth in CS&I revenue. As we think about this business over the next several quarters, we see continued pockets of investments remaining at more muted levels compared to 23 and 24. Over the long term, however, we believe that the drivers for silicon carbide remain intact, namely rising penetration of EVs and silicon carbide content within those EVs, particularly as 800-volt models and above are introduced to enable superfast charging. Growing adoption of silicon carbide in data center applications, given the critical need for more power efficiency. And finally, proliferation of silicon carbide across a wide array of other industrial and commercial applications. For example, HVAC systems, which globally consume a significant amount of electricity. This can be an interesting application of silicon carbide, given its ability to drive better power efficiency, which ultimately can lead to less strain on our power grid. Turning to silicon IGBTs, revenues muted as a result of continued cyclical softness in the auto end market, combined with the secular impact of growing adoption of silicon carbide. Nonetheless, we anticipate silicon IGBTs to remain a sizable SAM for our implant solutions over the long term, requiring our proprietary technology. In our general mature segments, customers continue to manage their capacity investments given the current demand environment in auto, industrial, and consumer electronics. As a reminder, a general mature segment spans a broad array of player devices with process modes of 28 nanometers and above. While we expect the overall market to remain in a digestion period through 2025, following several years of strong build-out, we are seeing some pockets of increased tool utilization, which, if it continues, is an important step forward towards a recovery in implant investments. It's also important to note that general mature market is ubiquitous to almost every aspect of our lives, including our phones, computers, cars, home, appliances, TVs, and factories, to name a few. As the world becomes more connected and digitized, we expect demand for these foundational technologies to grow accordingly. And we are well positioned as a critical enabler, especially given the higher intensity of implant required. Turning to slide seven, in advanced logic, we continue to engage closer with customers on their evaluation units as we work to expand this initiative. And as noted in our prior call, we anticipate a follow-on order from a customer that we added last year. Moving to memory, we saw a nice sequential improvement in sales to the memory market, specifically for DRAM. In NANs, Customers are focusing on technology transitions to higher layer counts, such as 1XX to 2XX and beyond, to drive better bit density rather than wafer capacity additions, which would be more impactful to iron implantation demand. As a result, we expect demand from NAND applications to remain muted over the balance of the year. On slide 8, let me wrap up my thoughts prior to handing the call over to Jamie. We're adapting to the rapidly evolving macroeconomic landscape, particularly as it relates to tariffs, and our primary focus is to continue to serve our customers to the best of our ability or striving to control costs and drive resilience in our global operations. Despite the macroeconomic and cyclical backdrop and uncertainty associated with tariffs, we're seeing robust engagement with customers on the next generation roadmaps across power, general mature, memory, and advanced logic, We believe that the long-term sector drivers for the semiconductor industry remain intact, with ion implantation being an enabling process step for every single chip that is manufactured in the world today. In fact, it happens to be one of the most complex technologies used in the semiconductor manufacturing process. At its core, ion implantation is a particle accelerator at scale. It requires the complexity of advanced nuclear physics combined with the throughput, quality, and extreme precision demanded for semiconductor manufacturing. Each implant can boast more than 10,000 unique part numbers and more than 5 million lines of software codes. We're able to deliver up to 15 million electron volts of energy in an ion beam. Our solutions are designed to implant more than 50 quadrillion ions per square centimeter of a wafer. And this has to be done with a half of 1% uniformity across the whole wafer. And finally, Our solutions are designed to implant pretty much any element in the periodic table into a wafer. All of this is the culmination of almost 50 years of expertise, know-how, close collaboration, and trial and error with nearly every semiconductor manufacturer in the world today. As a result, with the world needing more than $1 trillion of semiconductor devices by 2030 across all different categories, We expect the market for implant will continue to grow through the cycles, and we believe we are well positioned to capitalize on this opportunity that differentiated in the highly proprietary technology. With that, let me turn the call over to Jamie for a closer look at our results and outlook. Jamie?