Latest news with #AEIS
Yahoo
14-05-2025
- Business
- Yahoo
AEIS Q1 Earnings Call: Outperformance Driven by Data Center and Semiconductor Strength, Tariff Mitigation Key
Manufacturing equipment and systems provider Advanced Energy (NASDAQ:AEIS) announced better-than-expected revenue in Q1 CY2025, with sales up 23.6% year on year to $404.6 million. The company expects next quarter's revenue to be around $420 million, close to analysts' estimates. Its non-GAAP profit of $1.23 per share was 16.2% above analysts' consensus estimates. Is now the time to buy AEIS? Find out in our full research report (it's free). Revenue: $404.6 million vs analyst estimates of $390.1 million (23.6% year-on-year growth, 3.7% beat) Adjusted EPS: $1.23 vs analyst estimates of $1.06 (16.2% beat) Adjusted EBITDA: $65.4 million vs analyst estimates of $59.31 million (16.2% margin, 10.3% beat) Revenue Guidance for Q2 CY2025 is $420 million at the midpoint, roughly in line with what analysts were expecting Adjusted EPS guidance for Q2 CY2025 is $1.30 at the midpoint, above analyst estimates of $1.11 Operating Margin: 7.6%, up from 0.2% in the same quarter last year Free Cash Flow was $15 million, up from -$9.3 million in the same quarter last year Market Capitalization: $4.52 billion Advanced Energy's latest quarterly results were propelled by strong momentum in the data center computing and semiconductor markets, as management pointed to multiple new design wins and product ramps. CEO Steve Kelley explained that the company shipped over 350 units of its next-generation semiconductor products, a fivefold increase from the prior year, and noted that data center revenues more than doubled year over year due to hyperscale customer demand. Kelley emphasized, 'Our new products, which feature high reliability, high efficiency and high power density, are a good fit for power-hungry AI data centers.' Looking ahead, management expects continued growth in data center and semiconductor segments, while remaining cautious about industrial and medical markets due to lingering inventory corrections and tariff uncertainty. Kelley highlighted that the company's diversified manufacturing footprint and ongoing factory consolidation efforts position Advanced Energy to limit direct tariff exposure. He added, 'Although macro visibility in the second half is limited, current customer forecasts support growth for the year, particularly in data center and semiconductor.' Management attributed the quarter's performance to surging demand in data center and semiconductor markets, effective new product introductions, and operational improvements. The company also detailed steps to address tariff headwinds and invest in future growth. Data center momentum: Data center computing revenue more than doubled versus the prior year, with multiple hyperscale design wins ramping to volume. Management cited strong customer pull for high-density, high-power solutions well-suited for AI workloads. Semiconductor product traction: The company shipped over 350 qualification units of its new semiconductor products (eVoS, eVerest, NavX), with initial production ramps expected in the second half of the year. Kelley said these wins position Advanced Energy for share gains, especially in advanced logic and DRAM. Operational efficiency gains: Gross margin improvement was supported by cost control and progress on factory consolidation, including the pending closure of the last China factory. This is expected to further benefit margins in the second half. Tariff mitigation strategy: While tariffs present new headwinds, management believes their manufacturing footprint in Malaysia, the Philippines, and Mexico, along with USMCA-compliant production, limits exposure. Most direct tariff impact is expected in the industrial and medical segments. Industrial and medical recovery tentative: Industrial and medical revenue declined amid ongoing channel inventory destocking and weaker demand, but late-quarter order rebounds suggest a potential bottom. Management remains cautious, as the pace of recovery may be affected by tariffs and broader economic uncertainty. Management's outlook for the next quarter and full year rests on continued strength in data center and semiconductor demand, the successful ramp of new products, and disciplined cost management to offset tariff pressures. Data center and AI demand: The anticipated growth in AI-driven data center investment is expected to drive further expansion, with new design wins and rapid upgrade cycles increasing product content per system. New product ramp impact: Continued customer adoption and production scaling of next-generation semiconductor products are projected to support above-market growth and margin improvement, especially as qualification transitions to high-volume manufacturing. Tariff and macroeconomic risks: The company acknowledges external risks from tariffs and economic uncertainty, particularly in industrial and medical segments, but believes diversification in manufacturing and proactive supply chain adjustments will mitigate most impacts. Brian Chin (Stifel): Asked how Advanced Energy expects to outperform the broader semiconductor equipment market given flattish wafer fab equipment (WFE) forecasts. Management replied that its 10% growth outlook is driven by new product traction and strength in leading-edge logic and memory segments. Scott Graham (Seaport Research): Questioned plans to improve the industrial and medical business, including whether acquisitions are needed for scale. CEO Steve Kelley indicated ongoing M&A interest and highlighted a record design win pipeline but cautioned that market normalization will take time. Steve Barger (KeyBanc): Pressed for details on high-volume production potential for new semiconductor products. Management stated that ramping to high-volume could more than double shipments and increase dollar content per system, with most growth expected as customers launch advanced nodes. Mark Miller (Benchmark): Asked if margin improvements are sustainable and if new products carry above-average margins. CFO Paul Oldham replied that new products generally have higher margins, and factory consolidation plus increased volume should help approach the company's long-term margin goals. Chris Grenga (Needham & Company): Inquired about the impact of distributor microsites on industrial and medical sales. Kelley noted early success and expects expanded digital distribution to boost design wins and accelerate growth in these segments. For upcoming quarters, the StockStory team will closely watch (1) continued momentum in data center and semiconductor segments, particularly as next-generation products move from qualification to volume production, (2) the pace of recovery in industrial and medical markets as inventory destocking trends stabilize, and (3) the effectiveness of Advanced Energy's tariff mitigation strategies, including manufacturing realignment and supply chain optimization. Progress in these areas will be key to sustaining top-line growth and margin expansion. Advanced Energy currently trades at a forward P/E ratio of 24×. Is the company at an inflection point that warrants a buy or sell? The answer lies in our free research report. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
05-05-2025
- Business
- Yahoo
1 Surging Industrials Stock with Exciting Potential and 2 to Brush Off
Great things are happening to the stocks in this article. They're all outperforming the market over the last month because of positive catalysts such as a new product line, constructive news flow, or even a loyal Reddit fanbase. But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. Keeping that in mind, here is one stock with lasting competitive advantages and two not so much. One-Month Return: +35.8% Pioneering technologies for radio frequency power delivery, Advanced Energy (NASDAQ:AEIS) provides power supplies, thermal management systems, and measurement and control instruments for various manufacturing processes. Why Do We Think AEIS Will Underperform? Sales tumbled by 8.8% annually over the last two years, showing market trends are working against its favor during this cycle Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 6.6 percentage points Shrinking returns on capital suggest that increasing competition is eating into the company's profitability Advanced Energy is trading at $111.29 per share, or 22.2x forward P/E. If you're considering AEIS for your portfolio, see our FREE research report to learn more. One-Month Return: +42% Established in 1994, Orion (NYSE:ORN) provides construction services for marine infrastructure and industrial projects. Why Are We Out on ORN? Sales trends were unexciting over the last five years as its 2.4% annual growth was below the typical industrials company Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 10.1% annually Poor free cash flow margin of -0.2% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends At $7.24 per share, Orion trades at 44.6x forward P/E. Check out our free in-depth research report to learn more about why ORN doesn't pass our bar. One-Month Return: +31% A construction engineering services company, Quanta (NYSE:PWR) provides infrastructure solutions to a variety of sectors, including energy and communications. Why Will PWR Outperform? Sales pipeline is in good shape as its backlog averaged 23.1% growth over the past two years Estimated revenue growth of 10.2% for the next 12 months implies its momentum over the last two years will continue Earnings per share have massively outperformed its peers over the last two years, increasing by 22.4% annually Quanta's stock price of $321.12 implies a valuation ratio of 30.2x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it's free. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Yahoo
01-05-2025
- Business
- Yahoo
Wal - Mart de Mexico SAB de CV (WMMVF) Q1 2025 Earnings Call Highlights: Strong Revenue Growth ...
Release Date: April 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Wal - Mart de Mexico SAB de CV (WMMVF) reported a 6.5% increase in consolidated total revenue, driven by growth in both Mexico and Central America. The company opened 20 new stores in the first quarter, contributing 1.6% to total sales growth. E-commerce business grew by 17%, with a significant 26% growth from on-demand services. New businesses like Walmart Connect and Byte showed strong performance, with Walmart Connect growing revenue by 25% and Byte reaching 19.8 million active users. The company maintained a strong focus on price leadership and affordability, which helped improve customer satisfaction and trust. Same-store sales growth was modest at 1.4%, with a decline in transactions by 3.2%. The company faced macroeconomic challenges, including political noise and uncertainties, impacting overall performance. Gross margin expansion was limited, with only a 10 basis point increase in Mexico. SGNA expenses grew by 12%, driven by investments in new stores, technology, and labor costs. Inventory levels increased by 15%, indicating potential inefficiencies in inventory management. Warning! GuruFocus has detected 6 Warning Signs with AEIS. Q: Can you elaborate on the impact of macroeconomic conditions on your Q1 2025 performance? A: Ignacio Carri, CEO, explained that Q1 was challenging due to macro conditions, a strong comparative base, and calendar effects like the leap year and Easter shifting to Q2. Despite these challenges, the company saw progress, with a 1.4% same-store sales growth and a focus on maintaining low prices to help customers save money. Q: How did e-commerce perform during the quarter, and what are your future plans for this segment? A: Raul Quintana, Chief Omnichannel Operating Officer, reported a 17% growth in e-commerce, driven by a 26% increase in on-demand services. The company plans to enhance its marketplace and implement a "one hallway" initiative to improve customer experience by year-end. Q: What were the key drivers behind the growth in new businesses? A: Ignacio Carri highlighted that new businesses like Byte and Walmart Connect are enhancing the core business. Byte reached 19.8 million active users, generating 2.3 billion pesos in revenue, while Walmart Connect's revenue grew by 25%. Q: How is the company addressing the slowdown in certain product categories? A: Raul Quintana noted an industry-wide slowdown in categories like video games and TVs. The company is focusing on improving delivery KPIs and expanding its marketplace to counteract these challenges. Q: Can you provide more details on the financial performance and outlook for 2025? A: Paulo Garcia, CFO, stated that total revenues grew by 2.8% in Mexico, with a gross margin expansion of 10 basis points. The company expects a gradual ramp-up in revenues and maintains a sales growth guidance of 6-7% for the year. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
01-05-2025
- Business
- Yahoo
Advanced Energy Industries Inc (AEIS) Q1 2025 Earnings Call Highlights: Strong Revenue Growth ...
Release Date: April 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Advanced Energy Industries Inc (NASDAQ:AEIS) reported a 24% year-over-year increase in revenue, driven by strong performance in data center computing and semiconductor sectors. The company achieved a gross margin of 37.9%, which was better than expected due to improvements in operational efficiency and favorable product mix. AEIS is experiencing strong demand for its new products, with significant traction in the semiconductor market, particularly for its Evos, Everest, and Navex products. The company has a diversified manufacturing footprint, which helps mitigate the impact of tariffs and optimize production to meet customer needs. AEIS has a strong balance sheet, enabling it to pursue strategic acquisitions and invest in capacity and capability for growth. Industrial and medical revenue declined by 16% sequentially and 23% year-over-year, primarily due to ongoing inventory destocking and weaker demand. The company faces macroeconomic uncertainty and potential impacts from new tariffs, which could affect the pace of recovery in certain markets. Visibility into the second half of the year is limited, with potential challenges in maintaining growth momentum amid economic uncertainties. Operating expenses are expected to increase due to investments in new products and annual merit increases, which could impact profitability. The industrial and medical segment continues to face challenges, with a need for potential acquisitions to gain critical mass and improve performance. Warning! GuruFocus has detected 6 Warning Signs with AEIS. Q: Are you projecting a flat WFE (Wafer Fab Equipment) market, and how does your 10% growth outlook compare? A: We estimate WFE to be up 0-5% this year. Our projected 10% growth is above market due to factors like increased edge and depth intensity in leading-edge processes, strong traction of new products, and significant presence in logic and DRAM areas. - Steve Kelly, President and CEO Q: Can you provide insights on the potential tariff impact in the second half of the year? A: Most of our sales are to large companies that manage tariff issues themselves. Our exposure is mainly in industrial medical, with products built in Mexico and the Philippines. Many products are USMCA compliant, minimizing tariff impact. - Steve Kelly, President and CEO Q: What are the plans for improving the Industrial and Medical (I&M) segment, and is an acquisition necessary? A: Short-term, the I&M market is still recovering from excess inventories. Long-term, we aim to gain share through sole-source business and new design wins. Acquisitions are likely in I&M due to its fragmented market and sole-source positions. - Steve Kelly, President and CEO Q: How do you view the potential for high-volume production of Evos and Everest products? A: High-volume production will significantly exceed current levels. We've seeded the market with qualification units, and as they qualify, production ramps will start, increasing both unit and dollar market share. - Steve Kelly, President and CEO Q: What is the outlook for data center growth, and can you meet higher demand? A: We have strong visibility for 2025 with solid forecasts. We're increasing CapEx to support high-power requirements, positioning us to capitalize on higher volumes. - Paul Odom, Executive Vice President and CFO For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
01-05-2025
- Business
- Yahoo
Wal - Mart de Mexico SAB de CV (WMMVF) Q1 2025 Earnings Call Highlights: Strong Revenue Growth ...
Release Date: April 30, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Wal - Mart de Mexico SAB de CV (WMMVF) reported a 6.5% increase in consolidated total revenue, driven by growth in both Mexico and Central America. The company opened 20 new stores in the first quarter, contributing 1.6% to total sales growth. E-commerce business grew by 17%, with a significant 26% growth from on-demand services. New businesses like Walmart Connect and Byte showed strong performance, with Walmart Connect growing revenue by 25% and Byte reaching 19.8 million active users. The company maintained a strong focus on price leadership and affordability, which helped improve customer satisfaction and trust. Same-store sales growth was modest at 1.4%, with a decline in transactions by 3.2%. The company faced macroeconomic challenges, including political noise and uncertainties, impacting overall performance. Gross margin expansion was limited, with only a 10 basis point increase in Mexico. SGNA expenses grew by 12%, driven by investments in new stores, technology, and labor costs. Inventory levels increased by 15%, indicating potential inefficiencies in inventory management. Warning! GuruFocus has detected 6 Warning Signs with AEIS. Q: Can you elaborate on the impact of macroeconomic conditions on your Q1 2025 performance? A: Ignacio Carri, CEO, explained that Q1 was challenging due to macro conditions, a strong comparative base, and calendar effects like the leap year and Easter shifting to Q2. Despite these challenges, the company saw progress, with a 1.4% same-store sales growth and a focus on maintaining low prices to help customers save money. Q: How did e-commerce perform during the quarter, and what are your future plans for this segment? A: Raul Quintana, Chief Omnichannel Operating Officer, reported a 17% growth in e-commerce, driven by a 26% increase in on-demand services. The company plans to enhance its marketplace and implement a "one hallway" initiative to improve customer experience by year-end. Q: What were the key drivers behind the growth in new businesses? A: Ignacio Carri highlighted that new businesses like Byte and Walmart Connect are enhancing the core business. Byte reached 19.8 million active users, generating 2.3 billion pesos in revenue, while Walmart Connect's revenue grew by 25%. Q: How is the company addressing the slowdown in certain product categories? A: Raul Quintana noted an industry-wide slowdown in categories like video games and TVs. The company is focusing on improving delivery KPIs and expanding its marketplace to counteract these challenges. Q: Can you provide more details on the financial performance and outlook for 2025? A: Paulo Garcia, CFO, stated that total revenues grew by 2.8% in Mexico, with a gross margin expansion of 10 basis points. The company expects a gradual ramp-up in revenues and maintains a sales growth guidance of 6-7% for the year. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
