Veeco Instruments Inc.

Greetings, and welcome to the VECO fourth quarter and full year 2025 earnings call. At this time, all participants are in a listen-only mode. It is now my pleasure to introduce your host, Alex Delacroix, head of investor relations. Thank you. You may begin.

Thank you, and good afternoon, everyone. Joining me on the call today are Bill Miller, VECO's chief executive officer, and John Kiernan, our chief financial officer. Today's earnings release and slide presentation to accompany today's webcast is available on the VECO website. To the extent that this call discusses expectations for future revenues, future earnings, the timing and expected benefits of the proposed transaction with Excellus, market conditions, or otherwise make statements about the future, these forward-looking statements are based on management's current expectations. and are subject to the risks and uncertainties that could cause actual results to differ materially from the statements made. These risks are discussed in detail in our Form 10-K Annual Report and other SEC filings. BCO does not undertake any obligation to update any forward-looking statements, including those made on this call to reflect future events or circumstances after the date of such statements. Unless otherwise noted, management will address non-GAAP financial results. We encourage you to refer to our reconciliation between GAAP and non-GAAP results, which you can find in our press release and at the end of the earnings presentation. We will not be addressing questions related to our pending merger with Excellus. Please note that on February 6, 2026, our stockholders voted to approve all proposals related to our pending merger with Excellus. We urge you to read the joint proxy statement relating to the transactions with Excellus. With that, I would now like to hand the call over to our CEO, Bill Miller.

Thank you, Alex, and thank you everyone for joining us on our call today. Ricoh executed well in 2025 and accomplished important milestones setting the stage for future value creation. We grew our semiconductor business, experienced rapid expansion in our order activity for compound semiconductor, and data storage customers, supporting strong growth in 2026, and continue to invest strategically in next-generation technologies. Additionally, on October 1st, 2025, we announced an all-stock merger agreement with Excellus Technologies to create a leading semiconductor equipment company. Our new products are gaining powerful traction fueled by accelerating demand from AI and high-performance computing. as hyperscalers ramp their next generation infrastructure, we're seeing clear acceleration in order activity. This momentum drove a meaningful build in backlog at year end, supporting an increase in revenue for 2026. Later in the call, John will provide additional detail on our backlog. Revenue for our semiconductor business reached another record in 2025, which was primarily driven by laser annealing and wet processing and ion beam EUV technology. We shipped an LSA evaluation system to our second tier one DRAM customer, showing exciting progress for penetration with our memory customers. A key driver for the semiconductor market came from our advanced packaging business, which we doubled year over year. This was driven by wet processing and lithography tool shipments for 3D packaging. New products for the compound semiconductor market are gaining significant traction and driving market share gains. We received orders for our new Propel 300-millimeter Ganon silicon system for Gan power and micro-LEDs and Lumina Plus arsenide phosphide for photonics and solar end markets, which support revenue growth, primarily in the second half of 2026. Additionally, in the data storage market, We see customers expanding capacity, increasing CapEx spend, and adopting heat-assisted magnetic recording, resulting in increased orders in the third and fourth quarter of 2025 for our ion beam and wet processing equipment. This is driving an increase to revenue, principally in the second half of 2026. We continue to invest in strategic opportunities for future growth with our next-generation technologies. We've extended our IBD 300 systems evaluations at two DRAM memory customers into 2026. Our customers are providing positive feedback with respect to the quality of film performance. We remain excited about the opportunity to introduce ion beam as the fourth deposition technology for the front end semiconductor space. Additionally, our customers are evaluating our next generation nanosecond annealing systems, which are progressing well. and we expect to expand the evaluation program to another customer in 2026. Let me take a moment to briefly update you on the progress of our proposed merger with Excelis. We're pleased that shareholders of both companies approved the merger at their respective special meetings held on February 6th. In addition, we've secured regulatory approvals in several key jurisdictions and remain actively engaged with the relevant authorities in China as we work toward the final clearance needed to close. Based on our continued progress, we anticipate completing the transaction in the second half of 2026. Furthermore, our integration work with Excellus continues to reflect our strategic alignment and confidence in the merger. We believe the combination will increase R&D scale, enable a broader complementary product platform, realize several growth synergies, and ultimately drive sustainable returns for all our stakeholders. Switching gears to financial highlights for the quarter and full year. Our fourth quarter revenue came in at $165 million and our EPS came in at 24 cents, both at the midpoint of guidance. Our semiconductor business accounted for 67% of revenue. The full year top line was $664 million and our EPS was $1.33, with our semiconductor business hitting a record year, accounting for 72% of total revenue. This performance demonstrates we're well aligned with ongoing investments in advanced semiconductor technologies and customers' roadmaps. Next, I'll review Veco's critical role in the semiconductor manufacturing space, where the majority of our revenue is generated and we continue to grow year over year. Ricoh has historically had a strong position with Foundry and Logic customers for annealing applications, and the foundation has provided a high level of trust and repeat business across advanced nodes. At the same time, expanding our presence into memory is one of the most important strategic priorities. The transition to AI-driven architectures, high bandwidth memory scaling, and 3D structures are driving new thermal processing and material requirements, where VECO has clear technical advantages. For our LSA tool, we're a production tool of record at all three Tier 1 Logic customers, demonstrating our strong competitive position. Our next generation NSA system has two evaluations at Tier 1 Logic customers, and we're planning to ship an evaluation system to the third Tier 1 Logic customer in 2026. These evaluations for our customers' low thermal budget applications such as contact annealing, 3D device stacking, and material modifications are progressing well. We're expecting sign off of two evaluations during 2026 with the potential for pilot line orders to shortly follow. On the memory side, we continue to make meaningful progress penetrating the space and are expanding our footprint with Tier 1 DRAM manufacturers. In addition to being the production tool of record at a leading HBM DRAM customer, we recently shipped an LSA evaluation system to a second DRAM manufacturer, an important milestone that reflects growing confidence in our laser annealing capabilities for memory applications. We also have two IBD 300 systems under evaluation at leading DRAM customers with evaluations extended into 2026. Our IBD 300 system enables deposition of low resistance films that are critical for advanced DRAM structures such as bit line. This provides VECO with another opportunity to expand our SAM with the next generation memory nodes. Further penetrating the memory space represents a significant long-term growth opportunity as DRAM requirements become increasingly complex with the transition to HVM, stacked architectures, and low-resistance metallization designs. Our recent wins in evaluation activity represents early but significant steps toward establishing meaningful long-term growth in the DRAM market as this segment accelerates within the industry. Vico is also the market leader for IBD EUV systems for the deposition of defect-free mass blanks, leading logic and memory device makers continue to expand adoption of EUV and future adoption of high NA EUV lithography, which our IBD technology is a key enabler. We're also expanding our business to include EUV pellicles, which are increasingly being used to protect the mask from particles. We're confident our product roadmap is well aligned with the industry and our customers' needs. Lastly, in advanced packaging, We've doubled our business from $75 million in 2024 to $150 million in 2025, driven by AI-related demand. We've won multiple orders for advanced wet processing and lithography systems from leading foundries, and we continue to see strong demand driven by heterogeneous integration and 3D packaging. Looking ahead, we forecast semiconductor market growth at the leading edge driven by AI and high-performance computing. We expect our semiconductor served available market to continue to expand, driven by new nodes and AI-related demand, including investment in gate all around, high bandwidth memory, and 3D packaging. In annealing, we project our SAMs to be $1.3 billion by 2029, as devices continue to shrink And shallower and more precise anneals are required to improve performance. In 2026, we see our logic, foundry, and memory customers all increasing capacity for our annealing tools. Next, our IBD 300 platform for low-resistance metals, together with our ion beam deposition systems for EUV mask blanks and pellicles, represent a total SAM opportunity projected to reach $500 million by 2029. The need for low resistance metals deposited in a uniform manner is required for better device performance and to minimize power consumption. Lastly, in the backend semiconductor process, our advanced packaging business for our wet processing and lithography tools continues to expand and the SAM is projected to reach $650 million by 2029. Throughout the year, We've demonstrated the ability to respond successfully in meeting our customers extreme high volume manufacturing ramp of advanced packaging for AI. Based on the strong relationships we've developed with tier one foundry and memory customers, we're invited to engage with their R&D teams and becoming a critical partner in their future roadmaps. We continue to focus the organization on our key growth areas and remain excited about successfully positioning our business to align with industry advancements and meeting our customers' growing needs. I'll now hand the call over to John to walk through the financials and provide an outlook for 2026.