Onto Innovation’s backlog exceeded $1 billion for the first time in company history as growing investment in advanced logic, memory, high-bandwidth memory, semiconductor packaging and silicon photonics fueled record quarterly performance.
Advanced Nodes revenue increased 50% sequentially to a new quarterly record during the second quarter, driven by strengthening demand across logic and memory customers. Specialty Devices and Advanced Packaging revenue also reached an all-time high, supported by demand for 2.5D logic, high-bandwidth memory and silicon photonics applications.
Management tied the momentum to several technology transitions supporting next-generation artificial intelligence and high-performance computing devices. Customers are continuing to invest against multi-year expansion plans, helping push Onto’s backlog above $1 billion for the first time and giving the company visibility into demand extending through 2027.
Onto supplies semiconductor process-control technology spanning areas such as 3D metrology, wafer inspection, advanced packaging lithography, metal interconnect composition and factory analytics. These technologies are used to help semiconductor manufacturers manage yield, performance, quality and reliability as chip architectures become increasingly complex.
Second-quarter revenue reached a record $343.1 million, up 35.3% from $253.6 million a year earlier and nearly 18% sequentially. Revenue, gross margin, operating margin and earnings per share all exceeded the high end of Onto’s previous non-GAAP guidance.
GAAP gross margin increased to 53.4% from 48.2% a year earlier, while non-GAAP gross margin improved to 57% from 54.5%. GAAP operating income nearly doubled to $63.6 million from $32.2 million, and non-GAAP operating income increased to $102.8 million from $65.6 million.
Net income reached $60.1 million, or $1.21 per diluted share, compared with $33.9 million, or $0.69 per share, a year earlier. Non-GAAP net income increased to $96 million, or $1.93 per diluted share, from $61.3 million, or $1.25 per share.
Onto ended the quarter with $1.88 billion in cash and short-term investments and generated approximately $62 million in operating cash flow.
Growth is expected to continue into the third quarter. Onto projects revenue of $380 million to $400 million, non-GAAP operating margin of 31.5% to 32.5%, and non-GAAP diluted EPS of $2.18 to $2.38.
KEY QUOTES:
“Onto Innovation is positioned well across several key technology inflections driving next generation AI and high performance compute devices. High end-market demand, supported by our team’s solid execution, resulted in record revenue in both advanced nodes and advanced packaging.”
“Visibility continues to be strong with customers maintaining investments in their multi-year growth plans, resulting in a backlog exceeding $1 billion for the first time in company history.”
Mike Plisinski, CEO of Onto Innovation
