Besi shares gain over 6% on signals of recovery in hybrid bonding demand

Published 24/07/2025, 06:30
Updated 24/07/2025, 12:54
© Reuters

Investing.com -- BE Semiconductor Industries NV (AS:BESI) shares rose more than 6% on Thursday after the company pointed to a potential rebound in orders driven by hybrid bonding and advanced packaging demand in the second half of 2025, even as it posted a 30.9% decline in second-quarter orders.

The Dutch semiconductor equipment maker reported orders of €128 million for the three months ended June 30, down from €185.2 million a year earlier and 3% lower than the prior quarter. 

The drop was attributed to weaker demand in mobile and hybrid bonding applications, partially offset by new orders for the company’s TCB Next (LON:NXT) system.

Revenue for the second quarter fell 2.1% year over year to €148.1 million from €151.2 million, but increased 2.8% sequentially from €144.1 million, supported by higher die attach shipments for mainstream computing applications. 

Net income declined 23.4% to €32.1 million from €41.9 million a year ago, while operating income fell 11.8% to €43.5 million.

Gross margin narrowed to 63.3% from 65%, reflecting a less favorable product mix and foreign exchange impacts from a weaker U.S. dollar against the euro. Net margin declined to 21.6% from 27.7%.

Operating expenses totaled €50.2 million in the quarter. Research and development spending rose to €19.6 million from €18.5 million, and share-based compensation was €4.3 million. 

Financial expense increased to €5.7 million from €1 million, driven by higher interest costs related to a senior note offering in July 2024.

Cash and deposits stood at €490.2 million as of June 30, up 90.6% from a year earlier. Net cash was negative €36 million, reflecting a dividend payment of €172.8 million made during the quarter.

By geography, 45% of revenue came from Asia Pacific excluding China, 25% from China, and the remaining 30% from Europe, the United States, and other regions. 

Orders were led by Asia Pacific excluding China at 47%, followed by China at 35% and other regions at 18%. 

Integrated device manufacturers accounted for 56% of orders, with foundries and subcontractors making up 44%.

For the first half of 2025, revenue declined 1.8% year over year to €292.2 million, and net income dropped 16.2% to €63.6 million. 

Orders fell 17% to €259.9 million, while gross margin contracted to 63.4% from 66.1%.

Besi expects third-quarter revenue to decline 5% to 15% sequentially, with gross margin forecast between 60% and 62%. 

However, the company projected an increase in order intake during the quarter, citing higher demand for hybrid bonding and 2.5D packaging systems tied to AI applications.

Morgan Stanley (NYSE:MS) said the €128 million in second-quarter orders came in “well below” its €157 million estimate and the €149 million consensus. 

However, the brokerage called the revenue of €148 million “strong,” with gross margin and operating expenses broadly in line. Earnings per share were below expectations, partly due to currency effects.

Analysts noted a “thick silver lining” in the company’s guidance, flagging anticipated growth in hybrid bonding and CoWoS-like applications. 

They pointed to rising interest in TCB Next systems across both memory and logic markets. 

Morgan Stanley maintained its “overweight” rating on Besi with a €135 price target, citing expected acceleration in hybrid bonding orders and a 30% compound annual EPS growth rate.

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