What Happened:
Shares of semiconductor production equipment provider Amtech Systems (NASDAQ:ASYS) fell 7.2% in the morning session after the company reported third quarter results that missed analysts' expectations for revenue and earnings per share. Operating margins shrunk, and the company continued to burn cash. Guidance for next quarter was vague, with the company adding, "for the fourth fiscal quarter ending September 30, 2023, we expect revenue and operating profit to improve incrementally over the third quarter of fiscal 2023."
Additionally, the company announced that the CEO is stepping down, effective immediately. The company stated that "Michael Whang stepped down as Chief Executive Officer, effective August 8, 2023. The board has appointed Bob Daigle, current Chairman of the Board, with the additional role of Chief Executive Officer, effective August 8, 2023. To support the transition, Mr. Whang will remain as an advisor until February 8, 2024. "
Overall, it was a weaker quarter, offering little incentive for investors to maintain an optimistic outlook.
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What is the market telling us:
Amtech's shares are somewhat volatile and over the last year have had 27 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move was three months ago, when the stock gained 8.29% on the news that the company reported second-quarter revenue and gross margin ahead of analysts' estimates. Inventory levels also improved, though EPS missed. There was a $6.3mm revenue contribution from the recent acquisition of Entrepix. It is unclear how many sell-side analysts modeled the magnitude and timing of this deal correctly. Moving ahead, revenue guidance for the next quarter missed analysts' expectations. Overall, it was a mixed quarter which should result in some uncertainty, especially given the mixed outlook and macro commentary provided by peers that have reported earnings this season.
Amtech is up 10.9% since the beginning of the year, but at $8.85 per share it is still trading 31.6% below its 52-week high of $12.93 from August 2022. Investors who bought $1,000 worth of Amtech's shares 5 years ago would now be looking at an investment worth $1,720.
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