Q2 2025 ACM Research Inc Earnings Call
Good day, ladies and gentlemen. Thank you for standing by and welcome to the ACM Research, Inc. Second Quarter 2025 Earnings Conference Call. Currently, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. As a reminder, we are recording today's call. If you have any objections, you may disconnect at this time.
Now, I will turn the call over to Mr. Stephen, paleo managing director of the blue shirt group please. Steen, please go ahead.
Thank you. Good day everyone. Thank you for joining us to discuss second quarter, 2025 results, which we released before the US market open today, the release is available on our website as well as from our newswire services. There is also a supplemental, slide deck posted in the investor section of our website that we will reference during our our prepared remarks today on the call with me today are our CEO, David Wong, our CFO Mark mckeny and Lisa Fang. Our CFO of our operating subsidiary ACM, changhai. Before we continue, please turn to slide 2. Let me remind you that the remarks made. During this call, may include predictions estimates or other information that might be considered for looking these 4.
Looking statements, represent acms current judgment for the future. However, they are subject to risks and uncertainties that could cause actual results to differ materially. Those risks are described under risk factors and elsewhere in acms filings with the Securities and Exchange Commission. Please, do not Place undue Reliance on these forward-looking statements which reflect acms opinions only as of the date of this call. ACM is not obliged to update. You on any revisions to these 4 looking statements.
Certain other Financial results that we provide on this call will be on a non-gaap basis, which excludes stock based compensation, and the unrealized gain loss on short-term, Investments for our Gap results and Reconciliation between gaap and non-gaap amounts. You should refer to our earnings release, which is posted on the IR section of our website and to slide 13 also. Unless otherwise noted, the following figures refer to the second quarter of 2025 and comparisons are with the second quarter of 2024, I will now turn the call over to David Wong. David thanks Stephen. Hello, everyone and welcome to ACM research, second quarter.
Early conference call.
We delivered another quarter of good results with strong sequential growth in both revenue and achievement before, like the continual progress across our expanding.
Product portfolio: We saw momentum from our SPM, paho plating, and a furnace tool, which are helping expand our addressable market and gain market share. We also continue to make progress with our new platforms, including track PCBD and the panel-level packaging tools, which represent important long-term growth drivers.
We recently announced major upgrade to our Ultra CWD wet bench cleaning tool the technology.
Integrate ACM, patent pending nitrogen bubbling technology to generate the large size of the bubble with good bubble density. Uniformity, and enhance the etching rate in inform the in the 3D structure across the river.
I'm happy to announce that we have received repeat orders for the new Ultra CWB white bench tool with our proprietary, end to Bing technology. We expect the good shipments for this tool this year and the next
The technology is also adaptable to our autocord Tower platform with a significant application potential for manufacturing Advanced 3D net. 3D Ram, 3D logic devices.
With the belief, this new technology is another example of acms leadership in convenient tools that will be good for our customers and support our growth initiatives.
Our nation Bing technology tool as to early breakthrough for taco, and other recent product launching such as our high temperature, SPM tool, and the panel, level packaging tool for flux clean and the bevel ature.
Take her together. This is developments reinforced ACM. Differentiated leadership in wafer cleaning and give us confidence that we will continue to gain share in a critical segment.
Facial intelligence transformation.
Now, on to our business results. Please send to slide 3.
For the second quarter of 2025, We Believe revenue of 215 million, upper 25% sequential and 6% year-over-year. Shipment were 206 million of 32% sequential up 2% year-over-year.
Growth margin was a 48.7% exceeding. Our target range of 42 to 48. We ended the quarter with a net cash to a 6 million. Now, I will provide a detailed on product. Please turn to slide 4.
Revenue from single wafer, Canini Tahoe, and semi-critical cleaning tools grew 1% and represented 742% of total revenue.
We believe our top to bottom cleaning portfolio. Put us in a strong position.
We continue to make a technical Improvement and the customer progress with our SPM tool, our high temperature SPM system features, ACM proprietary nozzle design, which prevents
Both liquid SPM and acid Mist spat out of the chamber during SPM process.
This improving particle performance, reduced chamber. Uh, pre preventive maintenance, cleaning frequency and enhancer system uptime. We have achieved a better particle control over, average particle count less than 10 at this 26. Nano particle size. We also believe it will be showed better performance than comparators offering at a particle size smaller than 17 and 15 nanometer.
In Q2 with the uspm and Tahoe tools to serve more customers, as we continue to gain market, share in SBN space.
Revenue from ECP furnace and other Technologies grow 23% and represent 22% of the total revenue.
ECM recent delivered, a ECB tour to a customer, which included companies.
1500s electric plating Chambers shipped.
We are seeing strong momentum for the ECB tour in advanced packaging, driven by demand for both front-end and back-end trading systems.
We are also see growth interest in our new East Ultra ECP, AP panel level.
Horizontal plating system as the industry shift from were to panel level Packaging.
To support the next generation, AI chips use a unique horizontal plating approach which delivers superior uniformity compared to vertical panel plating. This solution has attracted attention from all major players.
Our furnace product are building momentum supported by strong, customer interest and expanded pipeline of evaluation, and their engagement. We see good demand across multiple application, including high temperature Neo, especially our 120050 degree C degree version titanium, Neo furnace.
And also lpcvd, oxidation and aod, we believe ACM. Differentiated the design position us to capture meaningful market share.
Revenue from Advanced packaging which is excluded ECP but including service and spell was up 20% and represent 6% of Revenue.
We're making good progress with a new track and pcbd platform.
Our proprietary. Pcbd platform with 3, charts for chamber. Give us a flexibility to support a wide range of process with the same Hardware. We feel good about our position.
Positioning with a plan to deliver more better tool to our handful of customers this year and look for Revenue contribution, 2026 and Beyond.
For track where in the final development phase of our 300, 300 wafer per hour in mind, KF tool and we expect to deliver the beta tool to a key customer in the current quarter.
To close on product.
our road map, including incremental contribution from Taco SPM, and a furnace tool in 2025 with the panel level packaging, track and PCV tool expected to drive growth in 2026 and Beyond
Please send to slide 6.
Our first half result, reflects solid execution across our product portfolio. We remain confident in the year and our long-term opportunity in China.
We have an increase, our long-term Revenue, Target for men and China to 2.5 billion versus our previous Target of 1.5 billion. The increase is based on 2 main factors first. We now assuming a long-term China W Fe Market size of 40 billion.
U.S. dollar versus our prior assumption of a $30 billion U.S. dollar. This is based on updates by a third party, Global Market Forecast, and also our view of the China semiconductor industry. Second, we have adjusted our market share targets.
For product group, as follows we have a risk, our market share Target for both cleaning and cleaning to 60% versus the 55% prior. This is the result of our current assessment of a customer traction and increased confidence.
For sheer gain for new products.
For a furnace TV and track, however, we are keeping our target at the 15%, 15%, and 10% level. Of course, we...
Aspire to achieve better result, but need more time in the market before we were formerly adjust the target.
Moving to the bottom of the chart, we maintain our Revenue Target for the rest of the world. At 1.5 billion, We Believe ACM focus on defense, AED water, cost product. Combined our Global Sales and Service team will deliver result with our Global customer.
As an example, we have a plan to deliver a server tool to the US in the third quarter. We remain engaged with our major Us customer with active, validation across a range of the cleaning process step as we continue to work towards our Global, our goal for production orders,
bottom line, we have reached our long-term Revenue, Target to 4 billion versus our prior Target of 3 billion.
Now, I will provide update on ASM Shanghai the proposed Capital risk in China.
ASM Shanghai recently received approval from the CSRC to proceed with its proposed follow-on offering on the stock market to raise up to $620 million by selling less than 10% of the total shares.
The capitol racing is a leadership, is a intended to help accelerator.
Updated Revenue targets and added to the long-term Foundation to support our effort to scale our product to Major Global customer.
As the majority.
Shareholder reveal their proposed transaction as an important step in strengthening our position in the China market and it demonstrate the long-term value of our ownership Stakes. Next, let me provide the update on our production facility
First is lingam, please tend to slide 8 as I discussed last quarter, a state of Art.
Dingdong production and our Center is nearly completed. The site, including 2 production building with the first now in production and the second available for future expansion. Each of the 2 production building can supporting up to 1.5 billion.
Of annual production capacity combined.
We believe we can eventually support 3 billion of our production at lingo for the from the 2 manufacturing building.
Next, our Oregon facility.
Pretend to slide the 9 wreck. We purchase the 40,000 square feet facility last year, we made a good progress during the second quarter. And we have
Began upgrade on our customer demo R&D lab. We believe this will help our effort with the customer in the region as they were later. Then test wafer locally on ACM tool. We also are moving forward with a plan to add production capacity to the Oregon facility. We target the middle 2026 for the demon lab and production to Commerce operations.
Our investment linggong and Oregon are key enable of our growth strategy, expanding our capacity, strengthening customer support, and prepare us to scare globally. Now, I will provide a look for the full year 2025. Please send to a slide 10.
We're maintaining our 2025 Revenue Outlook in the range of 850 million, to 950 million. This is implying 15%. Year-over-year, growth and Middle Point.
The call over to our CFO Mark. Who were revealed details are second quarter results? Mark please.
Yeah, thanks, David. Good day, everybody. Please turn to slide 11. Unless I know otherwise, I'll refer to non-GAAP financial measures, which exclude stock-based compensation and unrealized gain/loss on short-term investments.
Reconciliation of these 9 Gap measures to comparable. Gaap measures is included in our earnings release. Also, unless otherwise noted, the following figures refer to the second quarter of 2025 in comparisons, or with the second quarter of 2024, I'll now provide the financial highlights Revenue was 214 215.4, million up 6.4%,
Total shipments for 206 million versus 202 million in Q2 2424 and 157 million in q1 of 2025 strong sequential rebound. And Q2 shipments led to a return of positive year-over-year, shipment growth for the quarter. Gross margin was 48.7% versus 48.2% this succeeded at a long-term business model, target range of 42 to 48%,
we expect gross margin to vary from period to period, due to a variety of factors including your sales, volume product, mix and currency impacts.
Operating expenses for $63.4 million, up 38.8%. R&D was 14.5% of sales, sales and marketing was 9.3% of sales, and G&A was 5.6% of sales for 2025. We now plan for R&D in the 14% range, which is an increase versus last quarter's plan, due to ACM's continued focus on proprietary R&D programs. However, we plan for sales and marketing in the 8% range and G&A in the 5% to 6% range.
Operating income is 41.5 million down 20.2%, operating margin was 19.3% versus 25.6% income tax. Expense was 1.9 million versus 9.3 million for 2025. We expect our effective tax rate in the 10% range, that income attributable to ACM. Research was 36.8 million versus 37.5 million. Net income for diluted. Share was 54 cents. Versus 55 cents. Our non-gaap net, income excluded 9.8 million in stock-based compensation expense for the second quarter.
I will now review selected balance sheet and cash flow items. Cash Cash, equivalents restricted cash and time. Deposits for 483.9 million at a quarter end versus 498.4 million. At the end of the first quarter, net cash, which excludes, short-term and long-term debt was 205.89.
Total inventory at the end of the first quarter was $271.0 million. Net inventory was $648.3 million, compared to $669.6 million at the end of the first quarter. Raw materials were at $285.6 million, up $45.7 million quarter-over-quarter. We made strategic purchases to support production plans and to mitigate any potential supply chain risk.
Work in progress was 60.7 Million down 10.2 million quarter on quarter, finished goods, inventory was 302 million up, 2.2 million quarter, and quarter finished goods. Inventory, primarily consists of first tools, under evaluation, at our customer sites, along with finished goods, located at ATM facilities, cash flow used by operations for the first half of 2025, was 39.6 million versus 51.9 million cash flow provided by operations. In the year ago, period, Capital expenditures were 32.2 million for the first half of 2025 versus 39.7 million in the year ago. Period for the full year, 2025 we expect to spend about 70 million in capital expenditures. That includes our prepared remarks. Now, let's open the call for any questions that you may have operator. Please go ahead.
Thank you. Um, to ask a question, you'll need to press star 1, 1 on your telephone and wait for your name to be announced to withdraw your question. Please, press star 1 1, again please, stand by while we compile our Q&A roster.
Your first question comes from the line of Charles shei with nem and Company, your line is now open.
Should grow, maybe not necessarily growing faster than revenue this year, but that should grow. But it looks to me that in the second half of the year, you have a good amount of ketchup to do for a shipment to be flattish versus last year's level. Is it still the right target for us to think about shift end, or...?
Maybe the full year number may actually come down a little bit on year-to-year basis. Thank you. Hey, Charles, and uh, 2024 shihmen was a very strong, right? You recall about the, you know, over over 223 is 63% of their increased rate.
So then we also have a lot of new product and this year we're contributing to their ship this year.
So, I want to say their first second and a half year, obviously, much stronger than their first half of the year.
We expect growth to continue through 2025. I mean, growth is still achievable.
So, uh, a relative to let's say 90 days ago. Uh, the the expectation for shipment for this year. Do you see actually it's, um, uh, it's a shipment growth may be stronger than you, thought, 90 days ago or a flattish or or weaker, uh, any direction or color, you can provide. Uh, but the reason why I asked this may, maybe it's good to get your thoughts as well. Um,
Uh, your us peers um uh who have reported so far ahead of you have been seen China wfp upside especially for the second half of the Year. Wonder if you're seeing the same thing or not. Thank you.
Yeah, I should say our Q3 is very strong, right? We see the Q4 coming up, and there are still some slots we're going to fill in, so I still see it very good and look forward to Q4.
So, I was compelled, like you said, you know, 90 days ago, uh, we see that market situation got improved.
Got it. Um, lastly, I think, Mark, you mentioned some strategic purchase. Um, um, you made of the last quarter. Um, I think, uh, the the news flow did suggest that the US may be working on something at the, uh, in terms of actual control at the subsystem level 1. The, uh, What, uh, what, What's the ACM assessment? Um, uh, let's let's say supply chain risks. Uh, maybe, uh, for the reasons of uh, potential new export controls and uh, how as part of the company has a prepared um, um, to mitigate that the risk. And any thoughts on that front will be great. Thank you.
Yeah, David. Do you want to take that first? And I can add, or do you want me to go ahead and yeah, go ahead and obviously, um, you know, now, there we are doing the multi-source of the, uh, components, right? And we'll definitely need looking for the new, uh, components and supplier, uh, in the other country and then, then the US. And also, we have also uh, looking for the local supplier, uh, in the mainland China.
And, uh, um, I want to say, uh, there's a certain, you know, challenging. However, and I think we can, we can all overcome that with the multi Source alternative Source supplier for our uh, key, uh, components in the tool.
So mark on adding on that. Yeah, Char Charlie. The only thing I'd add. I think it's a good question. It's something that we look at a lot. I mean, it's, um, you know, we have a pretty good solid balance sheet, we have a good forecast, uh, for our shipments. So we thought it was the right thing to do to, uh, kind of increase some of our strategic supplies of, um, of some key components. So, um, we might even do a little bit more here in the second quarter. Yeah.
I'm sorry in the third quarter. Yeah.
yeah, maybe just a quick follow-up, uh, uh because the Strategic purchase it could be for
And um I won't really break out, you know, how much of it is uh is is is to mitigate the the risk or just kind of based on our our forecasts but it's a combination of those Charlie. Yeah.
Yeah, that's that. Thank you, Mark. I really appreciate that, the insights. Thanks. Yep. You bet. You bet. Thank you, John Charles.
Thank you.
Your next question, comes to the line of Mark Miller with the Benchmark company. Your line is now open.
I had a question about long-term borrowings, they're they're up significantly over the last 6 months, I'm just wondering what's going on there.
Yeah, I can I can hit on that a bit and then we got Lisa here in the background but um, long-term borrowing we did step things up a bit. Um, you know, there's there's controls over, you know, how we can use some of our capital from uh, from uh, from the China uh, Capital raise. And what have you? Of course, we have that coming along. So uh we we did step up our long-term borrowing, uh, a bit here in the uh in the first half of the Year Lisa, did you want to add something? Yeah, in addition to that, the the interest rate for deposit is much is uh much higher than borrowing.
In China. So we're trying to, you know, using that kind of Leverage.
To maximize the return, it’s a good opportunity to take the lower interest rate down. Yep.
Thanks Mark. Yeah.
Okay, thank you.
Next question. Please operator. Yeah.
Yes, thank you.
The next question comes from suji to Sylva with Roth Capital, your line is now open.
Mark Lisa, um, congrats to the progress here. So my, uh, Milestone wise, can you talk about the customer traction, outside China, and what? Um, some of the milestones we would look for Here, update, um, on those on the customer base to cross different parts of the world.
Yeah, yes. Hey suji and I think we're continually work with the key customer in Korea and they're also, you know, in the US
and the, um, this moment I want to say is
the, uh, let's take a look at more time. However, we are really working closely with the key customer, you know, evaluate our, uh, differentiate the convenient technology and our maxonic cleaning. And, uh, we are reaching, you know, a very encouraging result. Also, we're working with the Korean customer for their, uh, cover plating, uh, you know, product, and that also made the progress, right? And continuing, we're also exploring new customer in both the US and Taiwan.
And, uh, I think especially all, uh,
I want to say our uh panel level and packaging tool and you know, made a very strong attraction right from Taiwan customer too.
So, I want to say with our continued, Innovation and Technology will provide in the market.
And their, uh, we're going to have our, you know, uh, expand our sales revenue outside China, uh, especially where are now building our own Center in Oregon and also their, you know, manufacturing. And those are on the center, will a real uh, maker easier and for our cleaning cover plating demo, and for the customer also in China. And also manufacturing where we're doing right now, prepare for the Oregon
And that's really give us a strong position and to, um, you know, to real minimize impact of any, you know, tariff, uh, you know, situation. So, so we believe our strategy, you know, building our R&D Management Center in China in Korea and in us, we're further strengthening our position in the global market. And, uh, you know, we're we're fully confident, you know, with our new defensive product. And also, I want to say a lot of new future AI, uh, chip request, uh, a lot of new technology which is a, you know, even today nobody offered in the market.
Key customer in Canadian in cover plating and panel and also other new product, you know, we're we're planning to, so we still have a very strong confidence, right? We're getting to the uh, Global Market. I want to still want to say every customer in the world. They demand for the best technology, right? As as we, this meeting announced whether N2 bubbling technology will generate their launch sites into bubble.
Uh, with the, you know, uniformity of cross entire wafer in the past. So we believe that's what really, uh, driving their Innovation requirement and for their both, you know, 3D, net and 3D diran in the future, probably. Also the 3D logic down the road. So, that's another another word. I, I look at their, you know, our innovation technology or prints on the market.
Uh, okay, Mark, you want anything? Add on that?
Ya know, David, I think that was a good answer. Um, I mean, we're, we're working really hard with, uh, with our big us customers. We got, you know, some additional tools that are going to to a different organizations here in Q3 to the us. So, you know, our team is, is pretty active, uh, in Oregon, uh, we're pretty focused on, um, you know, getting, uh, our demo room up and running and uh, you know, being ready to produce tools in the US.
Hi Suzie.
Yes, thank you.
The next question comes from Edison Lee with Jeffrey's your line is now open.
Hey David and Mark how are you uh can I uh maybe ask you 2 questions. Number 1 is for the 2K growth uh at the revenue level is 6% which is actually below the growth rate that you are guiding for the full year. So what was actually driving that? Um,
Slower growth in the second quarter. And then, for 3 kill, you said that the auto is very strong. Can you share
The growth drivers coming from logic memory power and advanced packaging. So, which areas actually you are seeing the strongest growth in which area you are seeing the slowest growth. Thank you.
Yeah, you know I mean revenue can be lumpy right and uh we're still expecting, you know, 15% a million point growth for the year.
And, uh, uh, also, you know, we are, you're asking the Q3 driving force. I want to say still our cleaning and the cover plating is still the major driving factor there. And also a certain product, you know, customer requests where, you know, shipping turned to Q2 to Q3, right?
I want to say over the year, we still have her uh, you know, whole year expecting growth.
Better than the Q2.
Right. So in China can you talk about the growth that you're seeing from memory versus logic?
I would say there we we we both of our tools, sell to the memory and The Logical customer, right? But you would say, which is grow faster. I don't have a real number right now, putting in my hand,
Uh, I was both, um, you know, even looking there a long run, I want to say memory is still very strong, both the 3D n and also, uh, you know, this uh, DM business. And of course this, you know, logic and the people still building. Um, you know, Fabs and their, uh, both for maternal and all the advanced notes. And so,
So I want to say that I look in the next really a few year uh those uh those the market is very solid still there.
Okay, great. Thanks. David.
Thank you, thanks Anderson. Yeah.
Thank you.
As a reminder to ask a question, you'll need to press star 1, 1 on your telephone, and wait for your name to be announced.
Your next question comes from the line of Matt Cook with Pento. Your line is now open.
Hey David. Hey Mark, how's it going? Can you hear me? Okay man? Yes.
Help understand like what's caused the difference. I know there are different recognitions on revenue and finding. That's the first question, um, like why there was also so much better there? And, and if there could be some kind of like, you know, if that's, if that could swing the other way in, in Q3. And then these the second question is, uh, our shipment numbers different for ACM Shanghai, um, and if so what what are the million dollars? That would be great. Thank you.
Yeah, David. I can go ahead and hit that and you can add a few once. So, um, in reverse order. Yeah. I mean, simply the shipments are the same for both. Uh, they're, they're measured the same. Um, the the difference is, uh, rev wreck. And so, um, under China Gap, uh, the China organization recognizes Revenue upon installations and, of course us gaap is um, 606, right? Where we take, um, revenue on repeat shipments, um, or or upon acceptance when it's a, a first tool shipments. Uh, so just a, a timing difference, um, in in the revre standards. And this quarter was a, a little bigger, uh, that than it had been in the past, I think, um, it could be kind of a, um, a result of some of the bigger shipments that we had, uh, last year that, uh, it took a little long, you know, the timing of the installations here in uh, in in Shanghai. Um, and uh, we're we aren't literally guide how that's going to change uh for the back half.
For the year, you know, Q3 and Q4. I I don't think we're going to give any you know, specific details on that.
Yeah, yeah, I want to add on that, you're looking at a long run. This number 2 number should be matched, right? But looking at quarterly, quarterly debates. Do you get sometime us is higher? Sometime, you know, Shanghai is higher so that's as they, you know, Mark mentioned, different recognition of the revenue. So, so I want to say, overall, like you said, Shanghai number looks good, but that only quarterly quarterly base, right? And I want to say a whole year. I mean or long round this number is is very matching.
Hey, Matt, 1 1. Other thing I could bring out that that I think will be important is that um the US gaap. Um, and the R&D side we we don't capitalize anything, right? So it's all expensed. Um, and so there is uh, some capitalization of R&D. Uh, I don't know if they give out the, the, the exact mix but uh, that that's uh, the, the big difference is on the um, on the operating expenses that that's 1. And then, of course, uh, acmr the global operation. You know, we've got our cost of being a public company that and then we also have our sales and marketing effort that that are incremental expenses. Yeah.
Helpful. Thanks very much, you bet. Thanks man. Yeah.
Thank you.
Next question. Operator please. Yeah.
Greater next question, please.
Uh, I think we lost the operator here. Um,
Charles are you able do you have a live line trials? I I see. Charles sure is live as Q&A. Yes. Excuse me. Yeah, thank you. Next question comes to the line of Charles shei with neon my company your line is now open. Yeah.
Yeah, thank you.
Hey, can you hear me? Yes, Charles I can hear you. Yeah, I feel obligated that uh, to ask a question about the long-term Target. Uh, I think it's important update. Uh, but I have a really question. Um, um, the mainland China portion of the long-term projection there? Uh, I think, uh, 1 key change versus your prior
Pocket uh was the the mainland China WF in Mackay size, you kind of raised it from 30 billion to 40 billion. Um, it does match with where uh China wfp, numbers were trending, uh, over the last couple of years last year, I believe it's a slightly above 40 billion this year, maybe around 40 billion but
Where's the confidence? Uh, um, China, WBS. In maintaining at the at the, this 40 billion level over the long term. Thank you.
Okay. Charles obviously, you know year over year can be can be kind of a changing, right? Maybe 5 10 up and down and I want to say, uh, our long-term revenue is not for next year, right? It's like a 5 year or, you know, the timeline we talk about opium. So we believe that M that year China Market will be 40 billion.
that's what we talked about a long run of the, you know, goal,
And you look in the expanding in China of the either memory or the logic or including igbt, it's a lot of demand here. So that's our confidence. We believe that the market 40 billion, you know, you look in the 5 year down the road, it should be not number. Of course, there are global market growth too. So there's a 40 billion we think is a reasonable Target. We put their
And second 1, I want to see that is we do have also a new product and coming in and we are through the last last 3, 4 year R&D our foreigners pcbd and the track or, including our latest, you know, panel level package tool getting into their uh, you know. Um, the market and or started, you know, generate Revenue either this year. And also next year,
Uh second I want to mention that is we just get approved right from csrc and we have you know a second phone, a raising more than 600 million, those phone reasons that can help ACM to accelerating our uh uh the target R&D. And so that will be another big factor and third 1. I want to mention that is ACM has been really in China Market insists order differentiation, Innovative technology and to the market. And so, I believe, you know, Chinese invent, uh, the customer still, like the best technology with IP protection, so that real put ACM very unique position. And this moment when I'm not found any local Chinese company and copy our IP infringe our, you know IP. So we have a very confidence. ACM can maintain our differential product margin and also I said, you know, customer and locally is real designed in the best technology.
Which is a, we are providing a differential, you know, solution. So we are much better than those people provide their similar product. As since I said, we're providing differentiation. That's what solving the future needs. And, you know, and for the customer. So, with all 3 automation, so we are very, you know, confidence. That's why we raising this the, um, you know, China, China China market for 1.5 billion to 2.5 billion.
Thanks.
Yeah, thank you. I appreciate the the 1, wonderful color. Glad I asked.
Thank you.
Next question, comes to the line of Jimmy hang with JP Morgan. Your line is now open.
No. Hi, David Mark. Can you hear me?
Yes, please.
Yeah, thank you. So I want to ask about whether you have any outlooks told to me for 2026. And actually, can you also share about your estimates on the China WSB for 2025 and 2026, either in absolute numbers or through a comparison? Thank you.
Yeah. Well, I mean looking at 25 and uh, obviously you know different report, right? So, different results and looking at the gardener, they're pretty like in lower but you have another IC semi they're try. Also you know, show their very I want to say, you know, different results in other words, the better and then the you know, the uh the governor uh,
I mean, you're looking at 25 26, uh, you know, I'm still hard to predict there maybe, you know, I mean, 10% up and or down, right? But there for our, our feeding is doesn't matter. As I said at China Market still exists, you know, this, they already reach about their either, 30 35% of the global number really. So, so with
Our differential technology with a new product come out and even the flat of the revenue or the awf is spent in China. We still expecting our growth and also high growth. As I said, you know, our new product pcbd and whatever a few customers, you know, hands of customer coming to their evaluation this year.
Also added a new technology, as I mentioned, a panel level packaging, you know, the attraction and plus, you know, we have this high temperature, a new 1,250 degrees C and that's really can. Uh, real shorten the uh, a new time for the igbt also other critical application. So, as I said, all this, uh, new product, we put in the market and we will give us a a strong and confidence where where we have a growing fast even with the flat or, you know, uh, Chinese market as I mentioned just you know, I tell I ask answer Charlie is we offer China Market with real differentiate product and we feel confidence. We can protect our IP and therefore and there we can, you know, have our I want to say, you know, margin maintain and the um, the give their customer B the choice. And so we're not getting into, you know, that kind of similar product in price competition and
As I said, the the Chinese customer is still demand and for the best performance, if they're choosing performance with the price, of course, they're choosing in performance. And so that's why we're our our differential product can offer such a superior better result than those people provide the same in the product, right? So we think that will be the our strong point.
I think.
Yeah. Um if you don't mind, I might just add a few things on that. Um, just, you know, um, obviously we're not going to, we don't give our guidance for 2026 until early in the year, but you you probably noticed our Opex was was, uh, was pretty strong this year relative to our Revenue. Um, even if we do, you know, we do the midpoint, uh, it's still kind of a we're growing, our our Opex this year. And, and a big reason, is, we're spending into the market opportunity, right? I mean, David mentioned, a lot of the new R&D projects. We're also spending more on on sales and marketing, but clearly, um, that spending is, uh, you know, kind of anticipating a good growth ahead.
Yeah, on add on that, you know, compare the first tier guy, they're on the pocket, 10 to 12%, right? And then we'll spend the 14 to 16% and that's really show our, you know, having events that R&D, uh, also with our new product come out in a speed and we have more, you know, I call the product, you know, a new product cam ratio compared to the, you know, first tier Global guy. And that's why you show that our spend is higher. So that's why I was spending investing in R&D, and also Marketing sales and marketing. And there, that's real supporting our next 5 year growth. And we believe we spend this, uh, uh, I mean, we spend this uh, uh, operation in the spending. It's very important and also supporting our long, long run growth,
Yeah, thank you Dr. Wong and Mark also want to ask about the training equipment market, share Target related to 50% in the long run in China. Do you think, uh, in that case, what will be the split of the remaining 40% sure between other Chinese peers and international suppliers. Yeah.
Wow. Do you get 60% in China? Yeah, you have to you divide. Who is the second who is third, right? I mean again, we are we are children number 1 in China. Of course. Right? Why I see that is a are now product portfolio. Really almost can match 95% of the, our Canadian process staff. So, where are they? Probably the widest product in the world? Compared even the 3, big guy in in, in the global international, right? And also, as I said, our product has a lot of differentiation and, you know, powerful tool and saps, you know, maxonic, TBO and the non non violation or long damaging, uh, you know, Maxon technology and also continue adding, this reason announce the end to bubbling right with a special proprietary design, generate a large bubble size with with uniformity. So we're continuing really not just our product wide spread, also have another Innovative approach in the better than those, you know, top tier in the world. Especially I want to mention also,
And that's the strong point. And we are saying we're expanding China market, and also we're not facing any as I said again. You know, we got a very strong IP portfolio in China or in globally. Also, we do not expect any local Chinese, people can copy our tool, so that's a real strong confidence and we see their we're expanding the China Market of course, with those different product tests in China Market or push to the global right. As you know the Canadian has been more and more important and for their future AI chip manufacturing because of yield suffer so this Canadian become more and more challenging for 3D Land 3D. You know I mean theorem down the road and also 3D logic eventually people will see that. So all the 3D
Cleaning. We do have a a product, you know, technology ready for that. So we're we're very, you know, uh we're very exciting. We're very you know, and kind of see our our technology, you know, going to uh spread out in or or other Global Market.
Yeah, I see. Thank you, Dr. Maybe I have my next question. Can you, like talk more about your progress in Taiwan and Southeast Asia regions? Also for the pop testing because I think the English now thinks that I met production of Taiwan Foundry. Fop, or we call Coop, we'll wait until 2029 or even 30. I think the development time for Tech and Manufacturing will be longer than expected. So, how do you think about the mass production time?
Of the, uh, fop or co-op with the fee. Fine. Light space. Yeah. Not the the the large. Yeah. Nice space for the done by the pandemic because I mean, for the at manage, yeah, process.
Sure, actually, PRP this is in a panel level packaging. We believe is ready to go for the, you know, large size of the AI chip packaging, right? As the people lay down. And the panel is 2010 by 310 Square versus the, you know, Circle. They are effective area, increase, more than 6060 percent, right? It's, it's a bigger gain for the customer. It's for, it's better for a lot cheaper. Obviously, other people, I mean, get a note to 3 10 by 310 will probably very soon. Move into large size panel. So we believe that's really a strategic step, and the Taiwan customer, taking that direction. And as to the ACM, I feel, we have very good product, ready for that product. And we already put in the market for the, you know, um, low pressure, cleaning Babel a cleaning. Also, I want to mention that is our uh uh horizontal and their, you know, rotational electric plating. It's really a solution.
For this panel level, right? And why is a you looking at 20? Mm uh packaging you know used to be vertical and you go 300 mm wafer. Everybody turned to horizontal and now you can see our our, you know, panel level. We are no problem. Only guy providing the corona solution because our provider IP design. And as this year, you know, March we got a reward, I get the technical word from the i3d IC inside the USA. Uh, so we did, you know, our strong position in this horizontal plating were position AC, and very strong position for this future AI, you know, PRP market. So so we're, you know, we see that there as recently, we reach our horizontal, plating uniformity less than 5%. And I want to say, we're trying to next go to the less than 3%. So what what maintain equal, uh, performance panel Square plate in versus the circle?
Same. Same level that's really driving uh to the panel as you mentioned about 2029 or or timing. I think that that's really depend depend on technology driving. Right. And if you you know customer can solving the all issue they can speed up if they can kind of solving maybe delay. So real this is a you know Market is driven by 2 manufacturers technology combined together. So I mean with our cover plating, we definitely believe that's what be speed up, right?
In the cover plating process, which is 1 of the major block. And for the people moving from 300, mm wafer to the panel level. And we're glad, you know, this technology offers the to the customer enabling their uh, the production line and I hopefully speed up their production. That's a confidence. And also a way engaging with the customer in the, uh, in the uh Taiwan.
Who was the pilot from cos to co-op? Will they still stick to the original Japanese and American supplier? Or they could adopt new supplier for co-op?
Well, I want to see for the Titan.
Yeah, I want to say, I mean wait for level, we're engaging, right? I mean then you're looking at this panel level, I think we are much better Superior, you know, product, right. We have a level of probably will offer, you know, equal and this this moment I want, I want to see that. But for the real panel level, as I mentioned, you know, I mean, it looks in the last 10 years, nobody can do horizontal plating right, where the first guy announced the product, we can do horizontal. As I said, even today, we're about 5% uniformity, our next go, go, 3%. Uh, I believe with a strong IP position. We should offer the best panel plate into the world and again, right? That's really exciting, you know? For our uh, I call their uh, Panache in the global market and is 1 of the key product. We offer to the to enabling their technology for the customer. So we are very, you know, I call to put the effort on those uh, product development plus was a prepared additional uh, other differential product.
And also enabled in the panel level and we're going to announce probably you know, in the end of this year. Well, we're working on a new product too and to, to further get into the market. So we're very exciting about this panel level, right? It, it's a way to do because all AI chip got a size bigger and bigger.
I mean, we have a very working investment. A lot in this product.
I see, thank you so much, so I may have occupied too much time, but thank you so much for the the details.
Thank you.
Thank you.
Your next question, come to the line of young. We lay with UBS your line is now open.
Uh, hi. David. Can you hear us? Okay. Kevin
Yes, please.
Uh, uh, thanks for taking my question. Uh, just one quick one. Uh, seems like you were, uh, 222 years old. Your growth, even for Asia, is still outperforming other peers like China. Any reason for this height? Probably due to different, uh, customer exposure.
Thanks.
Question.
David, I think the question was, um, the growth may be of ACM Shanghai's revenue, or even RS versus some of the China peers. Uh, maybe the, uh, it was, you know, what's the reason for the difference?
Between China good and us with our folks, with other peer.
Uh, maybe between, uh, acmr, uh, both us and China and Shanghai versus other like China. Uh, wfq, thanks China, fears.
Oh, okay. Uh I I didn't see the other result come out. You know, China here. Obviously you looking at the Shanghai are Revenue. Growth is still looks good, right? And they're so, um, I want to say where where where where where confidence and also this year, as I said, you know, we're come to the moment of the multi-product.
And their, uh, revenue or not much contributions this year?
But with the next year we see our funnest PVD track that contribution, right? And also, we have a new product with a cleaning and their, uh, you know, continue expanding a couple of trading. So so I want to say, where we still have a very good, you know, uh confidence and also our look for 2026 and this year, and well, Q3 very, very busy and Q4, we have a cover slot open.
But we think it would be also you know, feel that soon. So in general we still have a good confidence, you know, we have uh you know uh good good glosses, still this year.
Oh, thanks pretty quick.
Thank you.
Thank you.
Seeing no more questions in the queue. Let me turn the call back to David wing for closing your remarks.
Okay. Thanks Aubrey there and thank you for all the participating on today's call and for your support before we close. Stephen is going to mention our upcoming investor Edition event. Stephen, please,
Semiconductor and semic 1-on-1 conference on August 25th, we will present at the Jeffrey semiconductor, it hardware, and Communications technology Summit at the 4 Seasons Hotel in Chicago on September 3rd. We'll present at the Benchmark 2025 TMT conference in New York City on October 7th, we'll present at the 17th annual CEO Summit in Phoenix, Arizona. Attendance at the conferences are By Invitation Only, we're interested investors, please contact your respective sales, representative to register and schedule 1-on-1 meetings with the management team. This concludes the call and you may now disconnect
take care.
Yes, thank you.