Axcelis Technologies Inc (ACLS) (Q3 2026) Earnings Call Highlights: Record Bookings and ...

Q: What is the outlook for 2027, and how much clean room capacity is coming online in memory versus 2026? A: CFO David Rizik said it is too early to give a concrete 2027 number, but Q1 2027 revenue should be relatively consistent with Q4 2026 despite seasonally lower CS&I, and the company expects memory, power and general mature to all grow next year. CEO Russell Lowe added that 2026 should be Axcelis' best-ever DRAM year, surpassing the prior $90 million record, with further growth expected in 2027 as mega fabs come online in phases of roughly 30,000 wafer starts every six months.

Q: With memory expected to grow and CS&I potentially declining as a percentage of mix, how should we think about the 2027 gross margin profile? A: CFO David Rizik noted memory systems carry lower-than-corporate margins, though the business is attractive due to long-term CS&I attachment. He said mix is too early to predict precisely, but higher overall volume should help factory absorption, and company-specific cost and manufacturing efficiency initiatives should support margins. He expects year-over-year gross margins to be higher than in 2026, with more color on the next call.

Q: What drove the spike in North American general mature bookings, including AI-related capacity expansion, and is this sustainable through 2027 and 2028? A: CEO Russell Lowe attributed the strength to spillover demand from AI data center buildouts into supporting infrastructure chips built on mature nodes, layered on top of an existing post-digestion recovery in automotive and consumer. He expects sustained growth, noting that more devicesphones, appliances and communications componentswill interact with data centers, while CFO David Rizik added robotics as a longer-term driver.

Q: Can you provide more detail on memory wins, including at the North American customer, and how much of DRAM revenue is high-bandwidth memory? A: CEO Russell Lowe said the vast majority of memory revenue is DRAM and HBM, with only one NAND tool in the quarter that he does not view as a trend. He said Axcelis has historically done well in Korea and is now gaining share outside Korea, with the top three memory makers planning to add over 1 million wafer starts per month over four to five yearsimplying roughly $150 million to $200 million of implant equipment per 100,000 wafer starts. CFO David Rizik declined to comment on specific customers but said strength is not just a rising tide, citing technology investments and customer engagement.

Q: How would you characterize the general arc of CS&I through 2027, and what FX assumptions are baked into Q4 gross margin? A: CFO David Rizik said CS&I grew faster than systems in 2026, but in 2027 systems could grow faster from a lower base, while CS&I should still grow on strong utilization and new fab spares, consumables and upgrade opportunities. On FX, he said Q4 does not embed the sharp Korean won headwind seen in Q3, given Axcelis' growing presence in Korea.

Q: Are you seeing component shortages or supply chain pressure that could affect Q4 revenue or gross margins? A: CFO David Rizik acknowledged tightness in the supply chain, similar to other equipment companies, but said Axcelis is not constrained for Q4, crediting a world-class operations team and pre-investment in inventory. He said 2027 is being monitored closely.

Q: What is the competitive environment versus suppliers like Applied Materials, and are competitors entering your markets? A: CEO Russell Lowe said Axcelis has always faced multiple competitors in the US, Japan and Taiwan, and China is developing domestic implant supply. He said the strategy remains close customer collaboration to solve high-value problems with differentiated technology, supported by heavy R&D investment, a full-portfolio offering and continued focus on gross margin and market growth.

Q: What was the memory mix in Q3 system sales, and what drove the strong bookings by application and geography? A: CFO David Rizik said memory was about 20% of total system sales, with CEO Russell Lowe noting one NAND system but mostly DRAM. On bookings, Lowe described a broad-based recovery across all segments and regions, with the biggest uptick in general maturestrong in China and increasingly in Europe and the USwhile power demand was also broad-based geographically, spanning 6-inch to 8-inch and planar-to-trench transitions.

Q: What is the outlook for silicon carbide, including higher-voltage applications such as 800-volt architectures and solid-state transformers? A: CEO Russell Lowe said power bookings have risen for four consecutive quarters and are now flowing into revenue, though power remains slightly down year over year versus 2025. He highlighted growing silicon carbide content per EV, the 800-volt "EV 2.0" architecture cutting charge times, and emerging data center applications stepping grid voltages down to 800 volts, alongside solar, wind and battery backup demand.

Q: What was China's share of Q3 revenue and bookings? A: CFO David Rizik said China was 46% of Q3 revenue, and system bookings were close to that level, in the mid-40s.

Q: What is your visibility into 2027 and the key revenue drivers across DRAM, general mature and power? A: CEO Russell Lowe said the major near-term contributors are power, memory, general mature and CS&I. Memory is all about DRAM, with 2026 already a strong yearQ1 2026 DRAM revenue alone exceeded all of 2025and further strengthening expected as new fabs are pulled forward

For the complete transcript of the earnings call, please refer to the full earnings call transcript .