As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the semiconductor manufacturing industry, including FormFactor (NASDAQ: FORM) and its peers.
The semiconductor industry is driven by demand for advanced electronic products like smartphones, PCs, servers, and data storage. The need for technologies like artificial intelligence, 5G networks, and smart cars is also creating the next wave of growth for the industry. Keeping up with this dynamism requires new tools that can design, fabricate, and test chips at ever smaller sizes and more complex architectures, creating a dire need for semiconductor capital manufacturing equipment.
The 14 semiconductor manufacturing stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 3.8% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady as they are up 1.3% on average since the latest earnings results.
Weakest Q2: FormFactor (NASDAQ: FORM)
With customers across the foundry and fabless markets, FormFactor (NASDAQ: FORM) is a US-based provider of test and measurement technologies for semiconductors.
FormFactor reported revenues of $195.8 million, flat year on year. This print exceeded analysts’ expectations by 3.4%. Despite the top-line beat, it was still a slower quarter for the company with a significant miss of analysts’ EPS estimates.
“FormFactor reported sequentially stronger second-quarter revenue that exceeded the high end of our outlook range, due to higher-than-anticipated growth in our probe-card business,” said Mike Slessor, CEO of FormFactor,
Unsurprisingly, the stock is down 17.3% since reporting and currently trades at $28.45.
Read our full report on FormFactor here, it’s free.
Best Q2: IPG Photonics (NASDAQ: IPGP)
Both a designer and manufacturer of its products, IPG Photonics (NASDAQ: IPGP) is a provider of high-performance fiber lasers used for cutting, welding, and processing raw materials.
IPG Photonics reported revenues of $250.7 million, down 2.7% year on year, outperforming analysts’ expectations by 9.4%. The business had an exceptional quarter with a beat of analysts’ EPS and adjusted operating income estimates.
The market seems content with the results as the stock is up 4.5% since reporting. It currently trades at $81.12.
Is now the time to buy IPG Photonics? Access our full analysis of the earnings results here, it’s free.
Marvell Technology (NASDAQ: MRVL)
Moving away from a low margin storage device management chips in one of the biggest semiconductor business model pivots of the past decade, Marvell Technology (NASDAQ: MRVL) is a fabless designer of special purpose data processing and networking chips used by data centers, communications carriers, enterprises, and autos.
Marvell Technology reported revenues of $2.01 billion, up 57.6% year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a significant improvement in its inventory levels but EPS in line with analysts’ estimates.
Marvell Technology delivered the fastest revenue growth but had the weakest performance against analyst estimates in the group. As expected, the stock is down 19.4% since the results and currently trades at $62.28.
Read our full analysis of Marvell Technology’s results here.
Kulicke and Soffa (NASDAQ: KLIC)
Headquartered in Singapore, Kulicke & Soffa (NASDAQ: KLIC) is a provider of production equipment and tools used to assemble semiconductor devices
Kulicke and Soffa reported revenues of $148.4 million, down 18.3% year on year. This number topped analysts’ expectations by 1.8%. Overall, it was a strong quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.
The stock is up 11.1% since reporting and currently trades at $35.65.
Read our full, actionable report on Kulicke and Soffa here, it’s free.
Amtech (NASDAQ: ASYS)
Focusing on the silicon carbide and power semiconductor sectors, Amtech Systems (NASDAQ: ASYS) produces the machinery and related chemicals needed for manufacturing semiconductors.
Amtech reported revenues of $19.56 million, down 23.1% year on year. This result beat analysts’ expectations by 15%. Taking a step back, it was a satisfactory quarter as it also recorded a beat of analysts’ EPS estimates but revenue guidance for next quarter slightly missing analysts’ expectations.
Amtech achieved the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is up 29.2% since reporting and currently trades at $5.79.
Read our full, actionable report on Amtech here, it’s free.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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