Advanced Energy Industries Q1 Earnings Beat Estimates, Revenues Up Y/Y

Advanced Energy Industries AEIS reported non-GAAP earnings of $1.23 per share in the first quarter of 2025, beating the Zacks Consensus Estimate by 18.27%. The bottom line jumped 112.1% on a year-over-year basis. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)Revenues of $404.6 million beat the Zacks Consensus Estimate by 5.1% and increased 23.5% year over year, primarily due to growth in new data center programs and continued strength in semiconductor.The top-line growth was up 5.1% sequentially, led by strength in Semiconductor and Data Center Computing.AEIS’ End Market in DetailSemiconductor Equipment: Revenues (54.9% of total revenues) generated from the market rose 23.5% year over year to $222.20 million. The figure topped the Zacks Consensus Estimate by 0.96%.Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise Advanced Energy Industries, Inc. price-consensus-eps-surprise-chart | Advanced Energy Industries, Inc. QuoteAEIS saw accelerating demand for its next-generation eVoS, eVerest, and NavX products, with over 350 qualification units shipped through the first quarter. This marked a fivefold increase year over year and a notable rise from more than 250 units shipped in the prior quarter, reflecting strong customer pull and growing momentum across its target markets.Industrial & Medical: Revenues (15.9% of the total revenues) from the market fell 22.9% year over year to $64.30 million and lagged the Zacks Consensus Estimate by 18.60%.Sequentially, revenues declined 16.3%. The decline can be attributed to ongoing channel inventory reduction and lower turns revenues.AEIS recorded major wins in industrial coating, robotics, therapeutic, and life science applications.Data Center Computing: Revenues (23.8% of the total revenues) from the market were $96.2 million, up 129.6% year over year. The figure beat the consensus mark by 67.99%. Sequentially, revenues increased 8.5%. The upside can be attributed to multiple new hyperscale programs that started to ramp up during the quarter.Telecom & Networking: Revenues (5.4% of the total revenues) generated from the market were $21.9 million, down 1.8% year over year. The figure beat the Zacks Consensus Estimate by 5.49%. Sequentially, revenues declined 5.2%.AEIS’ Operating ResultsIn the first quarter, the non-GAAP gross margin was 37.9%, up 280 basis points (bps) on a year-over-year basis.Non-GAAP operating expenses were $98.6 million, up 5.3% year over year. As a percentage of revenues, the figure declined 420 bps year over year to 24.4% in the reported quarter.The non-GAAP operating margin was 14.6%, expanding 940 bps on a year-over-year basis.AEIS’ Balance Sheet & Cash FlowAs of March 31, 2025, cash and cash equivalents were $723 million compared with $722 million as of Dec. 31, 2024.In the first quarter of 2025, cash flow from operations was $29.2 million, down from $82.7 million in the fourth quarter of 2024.Advanced Energy made dividend payments of $3.8 million in the reported quarter.AEIS Initiates Q2 GuidanceFor second-quarter 2025, Advanced Energy expects non-GAAP earnings of $1.30 per share (+/- 25 cents).Advanced Energy anticipates revenues of $420 million (+/- $20 million).ConclusionDespite strong demand in the semiconductor and data center markets, weakness across the Industrial, Medical and Telecom sectors may hurt AEIS’ top line.The company’s shares have lost 13.5% in the year-to-date period compared with the Zacks Computer & Technology sector’s decline of 10.8%.Advanced Energy currently carries a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point in the stock.Stocks to ConsiderStoneCo STNE, Paycom Software PAYC and Affirm AFRM are some better-ranked stocks that investors can consider in the broader sector. Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.StoneCo shares have surged 76.2% year to date. STNE is set to report its first-quarter 2025 results on May 8.Paycom Software shares are up 10.1% year to date. PAYC is slated to report its first-quarter 2025 results on May 7.Affirm shares have plunged 17.4% year to date. AFRM is scheduled to report its fourth-quarter fiscal 2025 results on May 8.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Advanced Energy Industries, Inc. (AEIS): Free Stock Analysis Report Paycom Software, Inc. (PAYC): Free Stock Analysis Report StoneCo Ltd. (STNE): Free Stock Analysis Report Affirm Holdings, Inc. (AFRM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks