Veeco Instruments Inc. reported a decline in financial performance for the third quarter of 2025, with net sales of $165.9 million, a decrease of 10% from $184.8 million in the same period last year. For the nine months ending September 30, 2025, total revenue was $499.3 million, down 7% from $535.2 million in 2024. The company's gross profit also fell, amounting to $67.7 million for the quarter, compared to $79.2 million a year earlier, reflecting a gross margin of 41% versus 43% in the prior year. Net income for the third quarter was $10.6 million, a significant drop of 52% from $22.0 million in the same quarter of 2024.
The decline in revenue was attributed to decreased sales in the Semiconductor, Compound Semiconductor, and Data Storage markets, which were partially offset by increased sales in the Scientific & Other market. Notably, sales in the Data Storage segment plummeted by 70% year-over-year, while Semiconductor sales decreased by 5%. Geographically, the United States saw a 55% drop in sales, while the Rest of APAC region experienced a 35% increase, indicating a shift in market dynamics.
In terms of operational developments, Veeco is actively pursuing strategic growth through its pending merger with Axcelis Technologies, announced on September 30, 2025. This merger is expected to close in the second half of 2026, subject to regulatory approvals and shareholder consent. The merger agreement has been unanimously approved by Veeco's board of directors, excluding one independent director who recused himself due to a conflict of interest. The merger is anticipated to enhance Veeco's market position and operational capabilities.
The company has also made significant investments in research and development, with R&D expenses totaling $29.0 million for the third quarter, down 10% from the previous year. This reduction reflects efforts to manage costs while continuing to innovate in semiconductor manufacturing technologies. Veeco's focus on advanced logic and memory technologies has positioned it well to capitalize on long-term growth trends in the semiconductor industry, despite current market challenges.
Looking ahead, Veeco anticipates growth driven by demand for advanced semiconductor technologies, particularly in AI and high-performance computing applications. However, the company remains cautious due to ongoing trade uncertainties and tariff impacts that could affect future demand. The management is committed to navigating these challenges while leveraging its technological advancements to capture market opportunities.
About VEECO INSTRUMENTS INC
Veeco Instruments Inc. designs and manufactures advanced semiconductor process equipment, including ion beam, laser annealing, MOCVD, CVD, and packaging lithography systems. Serving markets such as semiconductor, data storage, compound semiconductors, and scientific research, it provides high-precision tools for device fabrication, materials engineering, and advanced packaging. With global operations and a focus on innovation, Veeco supports high-volume manufacturing and next-generation technological development.
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