Advanced Energy Industries Q2 Earnings Beat Estimates, Revenues Up Y/Y

Advanced Energy Industries AEIS reported second-quarter 2025 non-GAAP earnings of $1.50 per share that beat the Zacks Consensus Estimate by 17.2%. The bottom line jumped 76.5% year over year. 

Revenues of $441.5 million beat the Zacks Consensus Estimate by 5.35% and increased 21% year over year. Sequentially, revenues increased 9.1%.

AEIS’ Q2 End Market in Detail

Semiconductor Equipment revenues (47.5% of total revenues) increased 11.3% year over year to $209.5 million. The figure topped the Zacks Consensus Estimate by 0.96%. Sequentially, segment revenues fell 5.7%.

Industrial & Medical revenues (15.5% of the total revenues) fell 13.3% year over year to $68.6 million and lagged the Zacks Consensus Estimate by 18.6%. Sequentially, segment revenues increased 6.7%. 
 

Advanced Energy Industries, Inc. Price, Consensus and EPS Surprise

Advanced Energy Industries, Inc. price-consensus-eps-surprise-chart | Advanced Energy Industries, Inc. Quote

Data Center Computing revenues (32.1% of the total revenues) were $141.6 million, up 94% year over year. The figure beat the consensus mark by 67.99%. Sequentially, segment revenues jumped 47.2%.

Telecom & Networking revenues (4.9% of the total revenues) were $21.8 million, down 11% year over year. The figure beat the Zacks Consensus Estimate by 5.49%. Sequentially, segment revenues fell 0.5%.

AEIS’ Q2 Operating Results

In the second quarter, the non-GAAP gross margin was 38.1%, up 270 basis points (bps) on a year-over-year basis.

Non-GAAP operating expenses were $103.6 million, up 9% year over year. As a percentage of revenues, the figure declined 260 bps year over year to 23.5% in the reported quarter.

The non-GAAP operating margin was 17.2%, expanding 900 bps year over year.

AEIS’ Balance Sheet & Cash Flow

As of June 30, 2025, cash and cash equivalents were $713.5 million compared with $723 million as of March 31.

In the second quarter of 2025, cash flow from operations was $46.5 million, up from $29.2 million in the first quarter of 2025.

Advanced Energy made dividend payments of $3.9 million in the reported quarter. The company repurchased $22.8 million of common stock at an average share price of $83.83 per share.

AEIS Offers Q3 Guidance

For third-quarter 2025, Advanced Energy expects non-GAAP earnings of $1.45 per share (+/- 25 cents).

The company anticipates revenues of $440 million (+/- $20 million). Semiconductor revenues are expected to decline slightly on a sequential basis. Industrial & Medical revenues are expected to grow modestly on a sequential basis. 

Third-quarter 2025 gross margin is expected to improve to roughly 38.5%.

Advanced Energy expects overall 2025 revenue growth to be approximately 17% with Data Center revenues to grow over 80% and mid-single digit growth in Semiconductor revenues. The company expects to more than double revenues from eVoS, eVerest and NavX platforms in the semiconductor segment in 2025. 

Advanced Energy expects gross margin to approach 40% exiting 2025.

Zacks Rank and Stocks to Consider

Advanced Energy currently carries a Zacks Rank #3 (Hold).

MKS Inc. MKSI, DoorDash DASH and Lumentum LITE are some better-ranked stocks in the broader Zacks Computer and Technology sector. Each of the three stocks currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

MKS shares have declined 11.8% year to date. MKS is set to report its second-quarter 2025 results on Aug. 6.

DoorDash shares have appreciated 52.3% year to date. DASH is set to report its second-quarter 2025 results on Aug. 6.

Lumentum shares are up 28.8% year to date. LITE is set to report its fourth-quarter fiscal 2025 results on Aug. 12.

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This article originally published on Zacks Investment Research (zacks.com).

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