管理層發言
Good day, and welcome to Nova's First Quarter 2026 Financial Results Conference Call. Please note this event is being recorded. I would now like to turn the conference over to Miri Segal, CEO of MS-IR. Please go ahead.
Thank you, operator, and good day, everyone. I would like to welcome all of you to Nova's First Quarter 2026 Financial Results Conference Call. With us on the line today are Gaby Waisman, President and CEO; and Guy Kizner, CFO. Before we begin, I would like to remind our listeners that certain information provided on this call may contain forward-looking statements, and the safe harbor statement outlined in today's earnings release also pertains to this call. If you have not received a copy of the release, please view it in the Investor Relations section of the company's website. Gaby will begin the call with a business update, followed by Guy with an overview of the financials. We will then open the call for the question-and-answer session. I will now turn the call over to Gaby Waisman, Nova's President and CEO. Gaby, please go ahead.
Thank you, Miri, and thank you all for joining us today. I will start the call by summarizing our first quarter performance highlights. Following my commentary, Guy will review the quarterly financial results in detail. Nova delivered another record quarter, exceeding guidance across financial and operational metrics. First quarter revenue reached $235.3 million with record profitability. This performance was supported by record revenue from memory devices, driven by robust demand for advanced DRAM alongside strong momentum in advanced packaging and gate-all-around applications. We achieved multiple customer wins and record sales in several of our product lines. Our focus on meaningful partnerships with our customers, operational excellence, differentiated solutions and investment in innovative technology are key building blocks in our continuing outstanding results. The latest Gartner market share report further attests to the resilience of our long-term strategy, showing an additional 400 basis points share gain in film and critical dimension metrology.
This is the second consecutive year of significant share growth, cementing Nova's position as this market's second largest vendor. AI investments remain a fundamental driver of industry growth with a shift towards agentic AI models, increasing computing and memory requirements. This is accelerating capacity expansion across Logic, Memory and advanced packaging while also introducing greater manufacturing complexity and yield challenges, driving higher process control and metrology intensity. These dynamics reinforce the relevance of Nova's portfolio and positions us well to support production ramps, yield improvement and demanding time-to-market requirements. Capacity expansion across all segments and tighter alignment with our customers' planning are improving our visibility and supporting our momentum. Our customers understand the importance of early engagement, and we are working closely with them to plan capacity and inventory levels to meet their demand.
As part of this planning, we are making strides in expanding our global manufacturing footprint with the construction of the new facility in Asia. This investment is designed to increase our production capacity, optimize our cost structure and improve load balancing across regions while positioning us closer to key customers and supply chain partners. The new facility is expected to become operational towards the end of 2026. Now let me turn to some business highlights for the quarter. In memory, we delivered record revenue this quarter, driven by strong demand for advanced DRAM applications, which accounted for approximately two-thirds of our memory business. This momentum was reflected in record sales of our Metrion platform, including repeat purchases by a leading memory customer for both advanced 3D NAND and DRAM devices as the platform continues to move from initial adoption into broader deployment.
Our front-end chemical metrology solution, Nova AncoScene, also achieved record sales, and we gained additional market share at a leading memory customer in Asia with multiple tool deliveries expected over the course of the year. At the same time, capacity expansions supported continued demand for our XPS and dimensional metrology solutions. Looking ahead, we also see robust HBM-related bookings for our Nova WMC and Semdex stand-alone platform. In Logic, increasing market demand and ramp-up of advanced device production led to record revenue from Nova's integrated metrology product line, driven by gate-all-around and new customer penetrations in mature nodes and advanced packaging. A great indicator of our strength in the Logic segment is the recent recognition we received from Intel, where Nova was awarded the Intel EPIC Supplier Award, the highest honor in Intel's global supply chain. Out of thousands of suppliers Intel works with, Nova is included in a select list of companies to receive this award in 2026.
This recognition underscores the scale and depth of our engagement and collaboration with Intel. In advanced packaging, the strong demand drove yet another record quarterly revenue. Our portfolio is well matched with the evolving demand in 2.5D and 3D packaging production. One such example is the Nova WMC that addresses the critical issue of increased warpage and non-uniform surfaces introduced by new advanced packaging schemes that bring forth new material and structural challenges. AI and broader scaling limitations are among the drivers of hybrid bonding processes. Adoption is progressing faster than expected in several advanced device segments. Because the process depends on direct copper-to-copper interfaces and ultrafine pitch interconnects, it is highly metrology-intensive, requiring tight control of surface planarity, alignment accuracy and interface integrity throughout multiple process steps.
Our portfolio positions us well to support this transition. This has already translated into strong positioning of our optical and chemical metrology platforms across top-tier manufacturers. Turning to services. We delivered record service revenue this quarter, marking the 13th consecutive quarter of sequential growth. This consistent performance reflects the expanding scale and increasing utilization of our installed base and the deep operational engagement our teams have with customers worldwide. To summarize my part, Nova delivered an all-round record quarter, highlighting the value of our tools and services. Customer schedule considerations are expected to have a positive impact on the first half of the year, and we expect the second half to run higher. We are setting the stage and solidifying our investments in technology and infrastructure towards the anticipated industry growth. Now for some more details on our financials, let me hand over the call to Guy.
Thanks, Gaby. Good day, everyone. I will begin by reviewing our financial achievements for the first quarter of this year and then provide guidance for the second quarter. We delivered record revenue of $235.3 million in the first quarter of 2026, exceeding the high end of our guidance range. Revenue grew 6% quarter-over-quarter and 10% year-over-year, demonstrating the strength of customer demand and the momentum of our product portfolio. Revenue mix was approximately 66% from Logic and Foundry customers and 34% from Memory customers, reflecting a broad-based contribution across our end markets. We also continue to benefit from a diversified customer and geographic footprint with 4 customers and 5 geographic regions, each contributing more than 10% of total product revenue. In the first quarter, blended gross margins were 57.7% on a GAAP basis and 59.4% on a non-GAAP basis, in the upper end of our target model range of 57% to 60%.
The strong gross margin performance was driven by a favorable product mix alongside continued growth in our services business, which contributed positively to overall gross margin performance. Operating expenses in the first quarter totaled $64.9 million on a GAAP basis and $59.4 million on a non-GAAP basis. We continue to invest strategically in R&D and go-to-market capabilities to accelerate innovation, support our expanding product road map and capture future growth opportunities. Operating margins in the first quarter reached 30% on a GAAP basis and 34% on a non-GAAP basis, exceeding the upper end of our target model range of 28% to 33%. This performance highlights the strength of our operating model and our continued focus on profitable growth. The effective tax rate in the first quarter was approximately 17%, modestly above our guidance, primarily reflecting the geographic and entity mix of income in the quarter.
We expect this dynamic to normalize as the year progresses. Earnings per share in the first quarter on a GAAP basis were $2.04 per diluted share, and earnings per share on a non-GAAP basis were $2.33 per diluted share, exceeding the high end of our first quarter guidance and driven by record quarterly performance. Next, I would like to share the details of our guidance for the second quarter of 2026. We currently expect revenue for the quarter to be between $245 million and $255 million. GAAP earnings per diluted share to range from $2.10 to $2.24. Non-GAAP earnings per diluted share to range from $2.34 to $2.48. At the midpoint of our second quarter 2026 estimates, we anticipate the following: gross margins of approximately 57% on a GAAP basis and approximately 59% on a non-GAAP basis. Operating expenses on a GAAP basis to increase to approximately $72 million. Operating expenses on a non-GAAP basis to increase to approximately $66 million.
Financial income on a non-GAAP basis is expected to be approximately $16 million. Effective tax rate is expected to be approximately 15%. As we conclude, we are pleased with our strong start to 2026, delivering record revenue and record profitability for the quarter. The continued momentum across our business reflects healthy customer demand, the value of our product portfolio and disciplined execution across the organization. Looking ahead, we remain focused on investing in innovation, supporting our customers' evolving needs and driving sustainable long-term growth while continuing to deliver strong financial results. With that, we will be pleased to take your questions. Operator?
分析師問答
The first question today comes from Elizabeth Sun with Citi.
This is Elizabeth for Atif. I guess my first question is, Gaby, in your prepared remarks, you talked about you had multiple customer wins in several product lines. So I was wondering if you could elaborate a little bit on that? Is it more on Memory or Foundry, Logic customers? And is it driven mostly by new products or overall strength across the portfolio?
Thank you so much, Elizabeth, for the question. So it's across Logic and Memory and across several of our product lines. I mentioned they are chemical metrology solutions. I also indicated the broader adoption of our in-line SIMS, the Metrion solution, but we see some wins across our product portfolio and definitely across segments.
Got it. And then on the share gain perspective this year, are you expecting similar outperformance versus the last two years? And where do you see the most share gain opportunities this year? Is this more from front end or packaging side?
So in terms of the share gain, I indicated that based on the Gartner report recently published, we grew about 400 basis points in 2025 compared to 2024, and this is the second consecutive year of growth, making us the second largest vendor in this space. We definitely aim to continue and drive market share. This is a primary objective where we have value to offer our customers. We look at all segments. Advanced packaging is definitely one of them. We have good traction with advanced packaging customers across the board, top-tier customers as well as growth in the Chinese advanced packaging realm. We also see initial good traction and adoption in hybrid bonding, also with top-tier customers and a higher metrology intensity there, which gives us good opportunity to grow our market share as a result of the metrology challenges such as flatness or interconnect yield. So we see good opportunities across the board and advanced packaging, in particular, is a growth area for us.
Next question comes from Michael Mani with Bank of America.
To start, could you give us your sense of where you think Nova's growth could end up for the full year maybe relative to WFE and maybe in context of some of the systems revenue guidance and full year WFE guidance that some of your peers have given. And very strong memory mix this quarter. How do you expect the mix between Foundry and Logic and Memory to kind of look for this year for you relative to prior years?
Thank you, Michael, for the question. So first of all, in terms of WFE, the way we read the market today, we expect WFE to reach mid-teens growth, and this is higher than what we were looking at back in February. We are expecting to outperform this number. The growth is driven by both Logic, Memory, and advanced packaging. Within Memory, of course, it's primarily DRAM. We did give a target as part of our strategic plan to reach $1 billion in revenue by 2027, and we are on track to reach this number. As you know, we are not providing guidance beyond that, but we're definitely on track. In terms of Memory versus Logic, we saw a growth in the memory share this quarter compared to last year. I expect Memory to become more dominant this year compared to last on the backdrop of investments in advanced DRAM.
Great. And for my follow-up, I just want to ask about gross margin. So nice strength there in the first half of this year, the upper end of your target. What were the drivers that led you to sustain at this 59% level? And do you think staying at these levels is possible through the second half? Just what are the puts and takes there?
Yes. Our target model, as I mentioned, is 57% to 60%. Currently, based on the business dynamic and the first half results, we see gross margins for 2026 will be within the same rate that we gave guidance for the first half of the year. So I would say this will be sustainable during the year.
The next question comes from Shane Brett with Morgan Stanley.
I want to follow up on the WFE growth benchmark for this year. Mid-teens is a little bit lower than what the process tool companies have talked about this year because they're talking about growth well into the 20s. Some of the drivers for WFE this year are greenfield DRAM and 3-nanometer logic where I perceive the process control intensity to be a little bit lower than 2-nanometer where the process control intensity is quite high. How should we think about your ability to outperform WFE in what can be perceived as a challenging year for process control?
Thank you, Shane, for the question. It's too early to call how process control specifically will look this year. Nova capitalizes on growth vectors of both process and process control which is a factor in driving growth. In process, for example, our integrated products are embedded in dimensional and chemical metrology that correlate to growth in the process sector; process control, where our dimensional metrology, such as our stand-alone products, are well positioned; and our material metrology portfolio also plays a role. We also tap into lab-to-fab adoption where we address emerging critical applications for advanced nodes. All in all, whether it's mid-teens or a bit higher, this is continuously updated. Over the last few months, we do expect to outperform, but it's too early to say how process control looks versus process. We tap into both.
Understood. For my follow-up, we're seeing a broadening of leading edge Logic investment with one of the players. You mentioned increasing process control intensity in-line inspection. We're also seeing more investment in 3-nanometer. How are you looking at the dynamics in leading-edge logic given the breadth of players expanding, but maybe more investment on N+1?
We are well positioned across all gate-all-around players. We're honored to take part in their growth and provide support on process control. We continue to invest in R&D to maintain differentiation and provide value as we did in the past. We see growing investment in areas such as 3 nanometers. The metrology intensity in gate-all-around is higher, but we also tap into growth of those advanced FinFET technologies. That intensity would increase as investment shifts or continues to grow on gate-all-around.
The next question comes from Matthew Prisco with Cantor.
Could you give us an update on where lead times stand today and how we should think about your visibility, both in terms of customer orders and how those customer conversations are going? Are those extending into 2027, 2028 at this point?
We have improved visibility toward next year. Customers are planning further ahead, and we're working closely with them on capacity and inventory levels. We do see some pull-ins driving the first half higher than originally forecasted, as you've seen from our guidance. In some cases, we are already receiving orders and planning 2027 deliveries. Our lead times are still shorter than some of our peers, but we do have higher visibility and more confidence in our annual performance. Timing of deliveries is driven by customers based on their demand structure.
That's helpful. As a follow-up on the supply side, given this robust demand backdrop, how are you thinking about capacity today? Any constraints on your side? If we're in a $180 billion plus WFE world next year, is that something you can support and continue outgrowing the market?
I indicated that we are launching a new production center in Asia that is expected to be operational towards the end of this year. This helps address growing demand and ensures we have the right capacity to support customers. We see some pressure on the supply chain and are mitigating that by working with multiple suppliers to maintain agility and flexibility. We're also seeing some cost pressure at the supplier level, mainly tied to higher chip prices and other factors. We have been able to manage and mitigate this through active cost management and leveraging long-term relationships. The important point is that we are managing suppliers to meet demand.
The next question comes from Charles Shi with Needham & Company.
First, can you talk a bit about your positioning in X-ray technology? We are hearing expanding opportunities for X-ray in areas like CD measurement and void detection for hybrid bonding. Nova is a leader in X-ray, especially XPS. What's your view on the market landscape in X-ray and how does Nova plan to capture these opportunities? Also, can you talk about your China expectation for this year? I recall last time you talked about maybe flat to slightly up. Has anything changed and how do you view your China growth this year?
There are multiple challenges and inflection points at both the front end and in advanced packaging for X-ray applications, and a broad spectrum of technologies can address these challenges. X-ray can play a significant role. We have a strategy that taps into hybrid metrology, which has been a cornerstone for years. We have a broad portfolio, both optical and X-ray, both homegrown. We engage in collaboration with customers on these challenges. For example, we published papers with Samsung on hybrid OCD plus Raman plus machine learning and with IBM on hybrid OCD with X-ray and machine learning. We see emerging XPS and material metrology in the front end and in advanced packaging. We also see emerging competition in XPS and material metrology from local vendors in China and other potential competitors in the coming years. We are investing in our roadmap to broaden our competitive advantage and provide value to customers to maintain our dominant position in this space.
Regarding China, it's a significant part of our business and overall WFE spending. As a result of advanced nodes growth, China's share of our revenue is expected to decrease as we saw last year compared to 2024. In the long term, we expect China to stabilize in the range of 25% to 30% of our business. We see increased demand in China for packaging with multiple new customer engagements around advanced packaging and high-bandwidth memory. China is a very competitive market, and we focus on offering best-of-breed products and best possible value and cost of ownership as differentiators. We are encouraged to see potential growth in China this year, so there is positive momentum in China compared to last quarter.
The next question comes from Vedvati Shrotre with Evercore ISI.
You're seeing your Logic customers put their roadmap together. How are you thinking about the $500 million gate-all-around revenue target? What do you think happens to gate-all-around revenues next year? Also, what are you thinking about advanced packaging growth this year or into the second half versus the first half?
We're on track for the forecasted $500 million cumulative gate-all-around revenue that we provided, and we are well positioned with all gate-all-around manufacturers across the portfolio. We see growth in gate-all-around investments in 2027 compared to this year as well. Advanced packaging for Nova is edging towards the mid-20s of product revenue this quarter with the majority coming from Logic. Looking forward, we also see healthy high-bandwidth memory bookings. For the year in general, we see similar levels of growth in advanced packaging to what our peers have mentioned.
The next question comes from Thomas O'Malley with Barclays.
This is Trip Smith on for Tom O'Malley. I wanted to step back to gross margins. Gross margin coming down sequentially in the guide in your range. Curious on the drivers there and why a bit of a step down? As a follow-up, curious about the timeline around hybrid bonding. You guys have talked about it being a driver. What are you seeing in that market and any color would be great.
We guided the gross margins for the second quarter non-GAAP at 59%. Usually when we are guiding, it's plus/minus 1%, so it's within the same magnitude.
We are encouraged by traction in hybrid bonding. We have good positioning with top-tier customers. We see higher metrology intensity in hybrid bonding. There are challenges such as flatness, CMP uniformity within wafer and within die pitch, edge roll-off, interconnect yield and a multitude of emerging challenges. This increases metrology intensity on top of advanced packaging, which already requires incremental metrology compared to the past. We see some pull-ins for hybrid bonding with some customers, especially Memory. There is an opportunity for us to continue to tap into this part of advanced packaging.
This concludes our question-and-answer session. I would like to turn the conference back over to Gaby Waisman.
Thank you, operator, and thank you all for joining our call today.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.