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PLAINVIEW, N.Y. - Veeco Instruments Inc. (NASDAQ: NASDAQ:VECO), a $1.59 billion market cap provider of advanced semiconductor process equipment with a healthy 43.5% gross margin, announced today that it has secured a new partnership with PlayNitride, a pioneer in MicroLED technology. According to InvestingPro data, the company maintains strong liquidity with a current ratio of 3.54, suggesting robust operational efficiency. PlayNitride has qualified Veeco's Lumina® Metal Organic Chemical Vapor Deposition (MOCVD) system for the production of cutting-edge MicroLEDs and has placed an order for two systems, scheduled for delivery in 2025.
The qualification follows a successful evaluation period during which PlayNitride assessed the Lumina® MOCVD system's capabilities. Dr. Charles Li, CEO & Chairman at PlayNitride, expressed satisfaction with the partnership, emphasizing the system's alignment with their production and commercialization goals for MicroLED technology across various applications, including wearables, TVs, transparent displays, and automotive sectors.
Veeco's Lumina system is designed to offer superior performance and productivity, which are critical for advancing MicroLED technology and improving cost efficiency. Anil Vijayendran, Vice President of MOCVD Product Line Management at Veeco, highlighted the significance of PlayNitride's decision, noting it as a testament to their MOCVD technology's industry-leading status.
The core of the Lumina system is Veeco's proprietary TurboDisc technology, which is known for its exceptional yield due to excellent thickness and compositional uniformity, as well as low defectivity rates. The system also supports high-throughput manufacturing and offers a clean reactor environment over extended periods. Furthermore, it allows for a seamless transition between different wafer sizes, capable of handling wafers up to eight inches in diameter.
Veeco's MOCVD technology is integral to producing various semiconductor devices, including infrared LEDs, Edge-Emitting Lasers, VCSELs, and Solar Cells. The company's portfolio includes a range of semiconductor fabrication and packaging solutions, designed to enhance performance, yield, and cost of ownership.
The partnership with PlayNitride underscores Veeco's commitment to innovation and its leading position in the semiconductor process equipment market, reflected in its 9.7% revenue growth over the last twelve months. However, investors should note that the stock has experienced a significant decline of about 42% over the past six months. For deeper insights into Veeco's financial health and growth prospects, including 7 additional exclusive ProTips, check out the comprehensive research available on InvestingPro. The information for this report is based on a press release statement and InvestingPro data.
In other recent news, Veeco Instruments reported solid financial results for Q3 2024, with revenues reaching $185 million and non-GAAP earnings per share (EPS) of $0.46. The company anticipates steady growth in the semiconductor sector, despite some market challenges. Veeco has narrowed its 2024 revenue guidance to $700 million to $720 million and anticipates diluted non-GAAP EPS between $1.68 and $1.78. Despite a projected decline in China revenue and challenges in the data storage market, the company remains optimistic about growth in AI, high-performance computing, and other sectors.
Veeco Instruments also announced that it expects minimal impact on its business in China following the introduction of new U.S. export regulations. The company has conducted a preliminary review of these new regulations and does not foresee a material impact on its operations in China. However, the firm's management is still in the process of fully evaluating the implications of the new rules on their product and service offerings.
Analysts from Needham have adjusted their price target for Veeco Instruments to $35, maintaining a Buy rating. This adjustment reflects the firm's revised revenue estimates for Veeco in 2025, forecasting a 6% revenue decline, mainly due to anticipated downturns in the Data Storage sector. Despite this, Needham continues to recommend Veeco Instruments as a Buy, suggesting confidence in the company's long-term value. These are recent developments in the company's financial trajectory.
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