ACM Research Reports Second Quarter 2023 Results

 

FREMONT, Calif., August 04, 2023 (Globe Newswire) – ACM Research, Inc. (“ACM” or the “Company”) (NASDAQ: ACMR), a leading supplier of wafer processing solutions for semiconductor and advanced wafer-level packaging applications, today reported financial results for its second quarter ended June 30, 2023.

 

“I am pleased with our second quarter results, with strong revenue growth and good profitability, as our operations have largely returned to a “new-normal” following several years of COVID-related disruptions,” said ACM’s President and Chief Executive Officer, Dr. David Wang. “Our results demonstrate good spending on mature nodes and market share gains at our customer base, together with penetration from new products and new customers.”

 

Dr. Wang continued, “We continue to expect  growth in 2023, driven by continued investments in mature node capacity by our China-based customers, and growing traction for our multi-product portfolio. We are moving forward with longer-term growth initiatives, with technical progress for our Track and PECVD platforms, continued evaluation of two cleaning tools at the U.S. facility of a major U.S.-based semiconductor manufacturer, and we plan to deliver our first evaluation tool to a major European semiconductor manufacturer during the fourth quarter of 2023.  We are excited to begin initial production at our facility in Lingang, Shanghai  later this year, and we continue to expand our operations in Korea to support the global market opportunity.”

 

 

 

The Company is maintaining its revenue guidance range for fiscal year 2023 of $515 million to $585 million. This expectation is based on ACM management’s current assessment of the continuing impact from international trade policy together with various expected spending scenarios of key customers, supply chain constraints, and the timing of acceptances for first tools under evaluation in the field, among other factors.

 

 

 

 

 

 

Unless otherwise noted, the following figures refer to the second quarter of 2023 and comparisons are with the second quarter of 2022.

 

 

 

 

 

 

 

 

 

 

 

 

A conference call to discuss results will be held on Friday, August 4, 2023, at 8:00 a.m. Eastern Time (8:00 p.m. China Time). To join the conference call via telephone, participants must use the following link to complete an online registration process. Upon registering, each participant will receive email instructions to access the conference call, including dial-in information and a PIN number allowing access to the conference call. This pre-registration process is designed by the operator to reduce delays due to operator congestion when accessing the live call.

Online Registration: https://register.vevent.com/register/BI9f104c7f57ab43bea588812dcca24b97

 

Participants who have not pre-registered may join the webcast by accessing the link at ir.acmrcsh.com/events.

A live and archived webcast will be available on the Investors section of the ACM website at www.acmrcsh.com.

 

 

ACM presents non-GAAP gross margin, operating expenses, operating income, net income attributable to ACM Research, Inc. and basic and diluted earnings per share as supplemental measures to GAAP financial measures regarding ACM’s operational performance. These supplemental measures exclude the impact of stock-based compensation, which ACM does not believe is indicative of its core operating results. In addition, non-GAAP net income attributable to ACM Research, Inc. and basic and diluted earnings per share exclude non-cash change in fair value of financial assets and liabilities and unrealized gain on trading securities, which ACM also believes are not indicative of its core operating results. A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure is provided below under “Reconciliation of GAAP to non-GAAP Financial Measures.”

 

ACM believes these non-GAAP financial measures are useful to investors in assessing its operating performance. ACM uses these financial measures internally to evaluate its operating performance and for planning and forecasting of future periods. Financial analysts may focus on and publish both historical results and future projections based on the non-GAAP financial measures. ACM also believes it is in the best interests of investors for ACM to provide this non-GAAP information.

 

While ACM believes these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of these non-GAAP financial measures. These non-GAAP financial measures may not be reported by competitors, and they may not be directly comparable to similarly titled measures of other companies due to differences in calculation methodologies. The non-GAAP financial measures are not an alternative to GAAP information and are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures. They should be used only as a supplement to GAAP information and should be considered only in conjunction with ACM’s consolidated financial statements prepared in accordance with GAAP.

 

 

Certain statements contained in this press release are not historical facts and may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “plans,” “expects,” “believes,” “anticipates,” “designed,” and similar words are intended to identify forward-looking statements.  Forward-looking statements are based on ACM management’s current expectations and beliefs, and involve a number of risks and uncertainties that are difficult to predict and that could cause actual results to differ materially from those stated or implied by the forward-looking statements.  A description of certain of these risks, uncertainties and other matters can be found in filings ACM makes with the U.S. Securities and Exchange Commission, all of which are available at www.sec.gov. Because forward-looking statements involve risks and uncertainties, actual results and events may differ materially from results and events currently expected by ACM. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. ACM undertakes no obligation to publicly update these forward-looking statements to reflect events or circumstances that occur after the date hereof or to reflect any change in its expectations with regard to these forward-looking statements or the occurrence of unanticipated events.

 

 

The Company develops, manufactures and sells semiconductor process equipment for single-wafer or batch wet cleaning, electroplating, stress-free polishing and thermal processes that are critical to advanced semiconductor device manufacturing, as well as wafer-level packaging. The Company is committed to delivering customized, high performance, cost-effective process solutions that semiconductor manufacturers can use in numerous manufacturing steps to improve productivity and product yield.

 

© ACM Research, Inc. The ACM Research logo is a trademark of ACM Research, Inc. For convenience, this trademark appears in this press release without ™ symbols, but that practice does not mean that ACM will not assert, to the fullest extent under applicable law, its rights to the trademarks.

 

For investor and media inquiries, please contact:

 

In the United States:

The Blueshirt Group

Yujia Zhai

+1 (860) 214-0809

yujia@blueshirtgroup.com

In China:

The Blueshirt Group Asia

Gary Dvorchak, CFA

+86 (138) 1079-1480

ACM RESEARCH, INC.

Condensed Consolidated Balance Sheets

ACM RESEARCH, INC.

 

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

 

ACM RESEARCH, INC.

Total Revenue by Product Category, by Equipment Type and by Region

 

ACM RESEARCH, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures

 

As described under “Use of Non-GAAP Financial Measures” above, ACM presents non-GAAP gross margin, operating expenses, operating income, net income attributable to ACM Research, Inc., and basic and diluted earnings per share as supplemental measures to GAAP financial measures, each of which excludes stock-based compensation (SBC) from the equivalent GAAP financial line items. In addition, non-GAAP net income attributable to ACM Research, Inc., and basic and diluted earnings per share exclude unrealized gain on trading securities. The following table reconciles gross margin, operating expenses, operating income, net income attributable to ACM Research, Inc., and basic and diluted earnings per share to the related non-GAAP financial measures:

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•	Revenue was $144.6 million, up 39% from the same quarter last year.

•	Shipments were $153 million, up 37% from the same quarter last year.

•	Gross margin was 47.6% and operating margin was 22.4%.

•	We achieved record revenue and EPS as our operations and industry supply-chains largely returned to a “new-normal” following several years of COVID-related disruptions.

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Single wafer cleaning, Tahoe and semi-critical cleaning grew 55%.  In the last few years, we introduced and began ramping our semi-critical product line, including auto bench and then last year, we introduced bevel etcher and high temperature SPM tools. Over the past quarter, we introduced super-critical CO2 dry. Now, ACM has one of the broadest cleaning product portfolios in the industry, covering nearly 90% of all cleaning process step. We believe this product portfolio will play a key role among mature nodes development in China and advanced nodes in our international efforts going forward.

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ECP, Furnace and other technologies, declined 7% due to quarterly fluctuation. However, for the first six months of 2023, ECP, Furnace and other technologies grew 40% year-over-year. Growth in this category was driven primarily by the ECP product cycle with some contribution from furnace. Our higher-temperature anneal and LPCVD furnaces, including Silicon Nitride and Poly and ALD have expanded to multiple customers and are under evaluation.

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Advanced packaging (excluding ECP), services and spares grew 14% in Q2 and 58% year-to-date. This category includes a range of packaging tools, including coater, developer, scrubber, PR stripper and wet etchers, and services and spare parts. ACM is the only company that offers both a full set of wet tools and the advanced plating tool. We believe advanced packaging will become more important as the industry looks for packaging innovation such as 2.5D and 3D interposal and Fanout to drive higher performance for new applications such as AI and GPT.

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Finishing up on products, we continue to make good progress on sales efforts with our new Track and PECVD platforms.  We are in active discussions with our key customers and we plan to deliver more evaluation tools this year.   Similar to our cleaning, plating and furnace product lines, our Track and PECVD platforms have proprietary technology that we believe will make them winners with major customers both in China and outside China.

•	We continued to make progress on customers both inside China and internationally.

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In China, we believe ACM’s tools are now used by nearly all the semiconductor manufacturers. Our sales and services teams are working to expand the deployment of each of our major product lines across our growing customer base. In addition to our current customers, we are also seeing a good number of well-funded new entrants. Our team has done a good job of getting good traction for our products with these customers. As these are new customers, these will be reflected in our shipments this year until customer acceptance at a later date.

•	Also, as some of you may have heard, on July 21st, 2023,  Hua Hong Semiconductor, a great strategic customer, announced the pricing of its Shanghai STAR market IPO and is expected to start trading soon. The total proceeds were 21.2 billion RMB or approximately $3 billion dollars.

•	In the U.S., the evaluation at our key customer is progressing well, and we remain optimistic for qualification later this year.

•	In Europe, we announced an order for our first evaluation tool from a major semiconductor manufacturer in the first quarter of this year. The tool is planned for delivery in early Q4, and we are beginning to build a local services team to support the effort.

•	In China, construction of our Lingang production and R&D center is nearly complete and is expected to begin initial production later this year.

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In Korea, as noted in prior calls, we have increased our commitment in this region. We believe a stronger commitment to Korea will improve our relationship with our key customer SK Hynix and others.  In Q1 of this year, we completed the purchase of land in the high-tech area outside of Icheon, as the site for a new R&D and production center.

•	In the U.S., as noted last quarter, we leased a facility in Oregon to add to our services support and demonstration capabilities for R&D and customer activities in the region.

•	Revenue for single wafer cleaning tools and semi-critical cleaning was $112.5 million, up 55.0%.

•	Revenue for ECP, Furnace, and other technologies was $19.1 million, down 6.7%. For the first six months of 2023, this category grew by 39.6% versus the prior year period.

•	Revenue for Advanced Packaging (excluding ECP), services & spares was $12.9 million, up 14.3%.

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On July 21, 2023, Armanino informed us it will resign as our independent auditor, effective as of the earlier of (a) when we engage a new auditor, or (b) the filing of this year’s third quarter 10-Q report. They advised us this was due to their decision to exit from the practice of providing financial statement audit services to all public companies.  As a result, our Audit Committee has begun the process to select and appoint a new auditor.

•	We filed an 8-K with the full details on July 27, 2023, and I would note we have also seen a number of similar filings from other Armanino clients.

•	Regarding the search for a new auditor, we are considering several options, including US and China-based auditors.