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MKS Instruments (MKSI) Q2 Earnings Top Estimates, Revenues Up
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MKS Instruments (MKSI - Free Report) reported second-quarter 2021 adjusted earnings of $3.02 per share, which beat the Zacks Consensus Estimate by 3.1% and surged 86.4% year over year.
Revenues of $750 million surpassed the consensus mark by 0.7% and increased 37.8% year over year, driven by buoyant demand for the company’s solutions in the semiconductor and advanced market.
Products revenues (87.6% of total revenues) were $656.7 million, up 38.8% from the year-ago quarter’s levels. Services revenues (12.4%) increased 30.7% year over year to $93.2 million.
Quarterly Update
Revenues from the semiconductor market (57.5% of total revenues) increased 34.1% year over year to $431.1 million owing to robust performance by the Vacuum & Analysis division.
MKS Instruments, Inc. Price, Consensus and EPS Surprise
Revenues from advanced markets (42.5% of total revenues) were $318.8 million, up 43.1% from the year-ago quarter’s levels. The upside can be attributed to recovery in demand trends for Advanced Electronics applications.
Segment-wise, Vacuum and Analysis revenues (61% of total revenues) surged 45.5% year over year to $457.7 million.
Light and Motion division revenues (25.7% of total revenues) increased 16.2% year over year to $193 million.
Equipment & Solutions segment revenues (13.2% of total revenues) were $99.3 million, up 55.7% year over year.
Operating Details
In the second quarter, adjusted gross margin expanded 210 basis points (bps) on a year-over-year basis to 47.4%.
Adjusted EBITDA increased 72% year over year to $229.1 million. Adjusted EBITDA margin expanded 610 bps on a year-over-year basis to 30.5%.
Research & development, and sales, general & administrative expenses, as a percentage of revenues, declined 120 bps and 290 bps on a year-over-year basis, respectively.
MKS Instruments reported non-GAAP operating income of $208 million, up 76.7% year over year. Adjusted operating margin expanded 610 bps on a year-over-year basis to 27.7%.
Balance Sheet
As of Jun 30, 2021, MKS Instruments had cash and short-term investments of $1.04 billion compared with $909.5 million as of Mar 31, 2021.
Secured term loan principal outstanding as of Jun 30, 2021, was $829 million. The company also had $100 million of incremental borrowing capacity under an asset-based line of credit, subject to certain borrowing base requirements.
Cash flow from operations was $165.2 million in the second quarter compared with the previous quarter’s figure of $126.9 million. Free cash flow was $148.9 million compared with $100.4 million reported in the previous quarter.
MKS Instruments paid out dividends worth $12 million during the reported quarter.
Q3 Guidance
For the third quarter of 2021, MKS Instruments anticipates revenues to be $720 million (+/- $30 million). The Zacks Consensus Estimate for revenues is currently pegged at $733.1 million, indicating growth of 24.3% from the figure reported in the year-ago quarter.
Non-GAAP earnings are expected to be $2.74 per share (+/- 26 cents).
The consensus mark for earnings is currently pegged at $2.80 per share, suggesting an increase of 45.1% from the figure reported in the year-ago quarter.
Zacks Rank & Stocks to Consider
Currently, MKS Instruments has a Zacks Rank #3 (Hold).
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MKS Instruments (MKSI) Q2 Earnings Top Estimates, Revenues Up
MKS Instruments (MKSI - Free Report) reported second-quarter 2021 adjusted earnings of $3.02 per share, which beat the Zacks Consensus Estimate by 3.1% and surged 86.4% year over year.
Revenues of $750 million surpassed the consensus mark by 0.7% and increased 37.8% year over year, driven by buoyant demand for the company’s solutions in the semiconductor and advanced market.
Products revenues (87.6% of total revenues) were $656.7 million, up 38.8% from the year-ago quarter’s levels. Services revenues (12.4%) increased 30.7% year over year to $93.2 million.
Quarterly Update
Revenues from the semiconductor market (57.5% of total revenues) increased 34.1% year over year to $431.1 million owing to robust performance by the Vacuum & Analysis division.
MKS Instruments, Inc. Price, Consensus and EPS Surprise
MKS Instruments, Inc. price-consensus-eps-surprise-chart | MKS Instruments, Inc. Quote
Revenues from advanced markets (42.5% of total revenues) were $318.8 million, up 43.1% from the year-ago quarter’s levels. The upside can be attributed to recovery in demand trends for Advanced Electronics applications.
Segment-wise, Vacuum and Analysis revenues (61% of total revenues) surged 45.5% year over year to $457.7 million.
Light and Motion division revenues (25.7% of total revenues) increased 16.2% year over year to $193 million.
Equipment & Solutions segment revenues (13.2% of total revenues) were $99.3 million, up 55.7% year over year.
Operating Details
In the second quarter, adjusted gross margin expanded 210 basis points (bps) on a year-over-year basis to 47.4%.
Adjusted EBITDA increased 72% year over year to $229.1 million. Adjusted EBITDA margin expanded 610 bps on a year-over-year basis to 30.5%.
Research & development, and sales, general & administrative expenses, as a percentage of revenues, declined 120 bps and 290 bps on a year-over-year basis, respectively.
MKS Instruments reported non-GAAP operating income of $208 million, up 76.7% year over year. Adjusted operating margin expanded 610 bps on a year-over-year basis to 27.7%.
Balance Sheet
As of Jun 30, 2021, MKS Instruments had cash and short-term investments of $1.04 billion compared with $909.5 million as of Mar 31, 2021.
Secured term loan principal outstanding as of Jun 30, 2021, was $829 million. The company also had $100 million of incremental borrowing capacity under an asset-based line of credit, subject to certain borrowing base requirements.
Cash flow from operations was $165.2 million in the second quarter compared with the previous quarter’s figure of $126.9 million. Free cash flow was $148.9 million compared with $100.4 million reported in the previous quarter.
MKS Instruments paid out dividends worth $12 million during the reported quarter.
Q3 Guidance
For the third quarter of 2021, MKS Instruments anticipates revenues to be $720 million (+/- $30 million). The Zacks Consensus Estimate for revenues is currently pegged at $733.1 million, indicating growth of 24.3% from the figure reported in the year-ago quarter.
Non-GAAP earnings are expected to be $2.74 per share (+/- 26 cents).
The consensus mark for earnings is currently pegged at $2.80 per share, suggesting an increase of 45.1% from the figure reported in the year-ago quarter.
Zacks Rank & Stocks to Consider
Currently, MKS Instruments has a Zacks Rank #3 (Hold).
Better-ranked stocks in the broader technology sector include Avnet (AVT - Free Report) , CyberArk Software (CYBR - Free Report) and Bruker (BRKR - Free Report) . While Avnet sports a Zacks Rank #1 (Strong Buy) each, both CyberArk and Bruker carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bruker, Avnet and CyberArk are set to report their earnings results on Aug 2, 11 and 12, respectively.