Advanced Energy Industries, Inc. (AEIS) Bundle
A Brief History of Advanced Energy Industries, Inc.
Advanced Energy Industries, Inc. (AEIS) has established itself as a leader in the precision power conversion solutions sector. The company specializes in providing high-performance power supplies and solutions for various applications including semiconductor manufacturing, industrial, and medical equipment.
Company Overview
Founded in 1981, Advanced Energy has evolved through various phases of growth, mergers, and acquisitions. The company went public in 1994 and has been listed on the NASDAQ since then. As of 2024, AEIS continues to focus on innovation and expansion in its core markets.
Financial Performance
As of September 30, 2024, Advanced Energy reported total revenues of $1.066 billion for the first nine months of the year, reflecting a decrease of 14.7% compared to $1.250 billion in the same period of 2023. The decline was primarily attributed to inventory rebalancing among customers leading to reduced demand in key markets.
| Metric | 2024 (9 Months) | 2023 (9 Months) | Change (%) |
|---|---|---|---|
| Total Revenue | $1,066,639,000 | $1,250,539,000 | -14.7% |
| Net Income | $5,340,000 | $90,782,000 | -94.1% |
| EPS (Diluted) | $(0.38) | $0.89 | -142.7% |
Market Segments
Advanced Energy operates across several market segments. The semiconductor equipment sector remains a strong revenue generator, contributing approximately 53.0% of total revenues for the nine months ended September 30, 2024. However, the industrial and medical sectors saw significant declines, with revenues decreasing by 34.6% year-over-year.
| Market Segment | 2024 Revenue ($) | 2023 Revenue ($) | Change (%) |
|---|---|---|---|
| Semiconductor Equipment | $565,721,000 | $552,419,000 | +2.4% |
| Industrial and Medical | $239,359,000 | $365,849,000 | -34.6% |
| Data Center Computing | $195,519,000 | $187,021,000 | +4.5% | Telecom and Networking | $66,040,000 | $145,250,000 | -54.5% |
Recent Developments
In 2024, Advanced Energy announced a restructuring plan aimed at optimizing its manufacturing operations. This plan includes the closure of its Zhongshan, China facility, which is expected to incur approximately $28.5 million in related charges. The company anticipates completing this plan by mid-2025.
Stock Performance
As of September 30, 2024, the company had approximately 37.671 million shares outstanding, with a market capitalization fluctuating around $1.164 billion. The stock has experienced volatility, reflecting broader market trends and company-specific developments.
Cash Flow and Liquidity
For the nine months ended September 30, 2024, Advanced Energy reported net cash provided by operating activities of $48.059 million, significantly lower than the $124.933 million reported in the same period of 2023. This decline indicates challenges in maintaining operating cash flow amid reduced revenues.
| Cash Flow Item | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Net Cash from Operating Activities | $48,059,000 | $124,933,000 |
| Net Income | $5,340,000 | $90,782,000 |
Outlook
Looking ahead, Advanced Energy aims to navigate the current market conditions by focusing on innovation in power solutions and optimizing its operational efficiencies. The company remains committed to its long-term growth strategy while addressing the immediate challenges posed by fluctuating demand in key sectors.
A Who Owns Advanced Energy Industries, Inc. (AEIS)
Major Shareholders
As of 2024, Advanced Energy Industries, Inc. (AEIS) has a diverse shareholder base, including institutional investors and individual shareholders. The following table summarizes the major shareholders and their respective ownership percentages:
| Shareholder | Ownership Percentage (%) | Type of Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 8.5 | Institutional Investor |
| BlackRock, Inc. | 7.2 | Institutional Investor |
| SSgA Funds Management, Inc. | 5.9 | Institutional Investor |
| Dimensional Fund Advisors LP | 4.8 | Institutional Investor |
| Wellington Management Group LLP | 4.5 | Institutional Investor |
| Other Institutional Investors | 25.0 | Various |
| Individual Shareholders | 40.1 | Retail Investors |
Insider Ownership
Insider ownership is significant for AEIS, reflecting confidence in the company's future. The following table outlines the ownership details of key executives and board members:
| Name | Position | Shares Owned | Ownership Percentage (%) |
|---|---|---|---|
| Yuval Wasserman | President & CEO | 150,000 | 0.4 |
| Gregory D. McMillan | CFO | 75,000 | 0.2 |
| Other Executives | Various | 200,000 | 0.5 |
Stock Performance
As of September 30, 2024, the stock performance of AEIS has been notable, with the following key financial metrics:
| Metric | Value |
|---|---|
| Current Stock Price | $93.58 |
| Market Capitalization | $1.1 billion |
| 52-Week High | $130.00 |
| 52-Week Low | $85.50 |
| Dividend Yield | 0.43% |
Recent Acquisitions and Strategic Moves
In 2024, AEIS acquired Airity, which contributed to its growth strategy. The acquisition details are as follows:
| Acquisition | Amount ($ million) | Date |
|---|---|---|
| Airity | 19.61 | June 20, 2024 |
Following the acquisition, AEIS issued 0.1 million shares of common stock valued at $15.6 million, of which $4.5 million was allocated to purchase consideration.
Financial Overview
The financial performance of AEIS in the first three quarters of 2024 is summarized below:
| Metric | Q3 2024 ($ million) | Q3 2023 ($ million) |
|---|---|---|
| Revenue | 374.2 | 410.0 |
| Net Income | 5.34 | 32.72 |
| EPS (Diluted) | 0.19 | 0.89 |
Conclusion of Ownership Analysis
The ownership structure of Advanced Energy Industries, Inc. is characterized by substantial institutional investment, significant insider ownership, and a diverse retail investor base. The strategic moves and financial performance indicate a proactive approach to market challenges and growth opportunities.
Advanced Energy Industries, Inc. (AEIS) Mission Statement
Company Overview
Advanced Energy Industries, Inc. (AEIS) specializes in precision power conversion and control solutions for various industries. The company focuses on delivering high-quality, engineered products that maximize energy efficiency and performance.
Mission Statement
As of 2024, Advanced Energy's mission statement emphasizes their commitment to providing innovative power solutions that enhance productivity and sustainability for their customers. The mission reflects the company's dedication to advancing technology in energy conversion and management.
Financial Performance Metrics
For the three months ended September 30, 2024, Advanced Energy reported the following financial highlights:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Revenue | $374,217,000 | $409,991,000 |
| Gross Profit | $134,068,000 | $147,341,000 |
| Net Income (Loss) | $(14,905,000) | $32,721,000 |
| Operating Income (Loss) | $(11,048,000) | $30,061,000 |
Revenue Breakdown
The revenue for the nine months ended September 30, 2024, was segmented by market as follows:
| Market | Revenue (9M 2024) | Revenue (9M 2023) |
|---|---|---|
| Semiconductor Equipment | $565,721,000 | $552,419,000 |
| Industrial and Medical | $239,359,000 | $365,849,000 |
| Data Center Computing | $195,519,000 | $187,021,000 |
| Telecom and Networking | $66,040,000 | $145,250,000 |
Key Financial Ratios
For the nine months ended September 30, 2024, the following financial ratios were reported:
| Ratio | Value |
|---|---|
| Gross Margin | 12.55% |
| Operating Margin | 0.24% |
| Net Margin | (1.40%) |
Stock Performance
As of September 30, 2024, Advanced Energy's stock data included:
| Metric | Value |
|---|---|
| Shares Outstanding | 37,671,000 |
| Stock Price (Closing) | $38.00 |
| Market Capitalization | $1,431,458,000 |
Future Outlook
Advanced Energy plans to continue focusing on innovation and expansion in the semiconductor and industrial markets to sustain growth. The company aims to enhance their product offerings to meet evolving customer demands.
How Advanced Energy Industries, Inc. (AEIS) Works
Overview of Operations
Advanced Energy Industries, Inc. (AEIS) specializes in precision power conversion solutions for various applications, including semiconductor equipment, industrial and medical sectors, data center computing, and telecom and networking. The company designs and manufactures a range of products, including power supplies, control systems, and related software.
Financial Performance
As of September 30, 2024, AEIS reported total revenues of $374.2 million, down from $410.0 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenues were $1.067 billion, compared to $1.251 billion for the same period in 2023.
| Period | Revenue (in millions) | Gross Profit (in millions) | Net Income (in millions) |
|---|---|---|---|
| Q3 2024 | $374.2 | $134.1 | $(14.9) |
| Q3 2023 | $410.0 | $147.3 | $32.7 |
| 9M 2024 | $1,066.6 | $374.6 | $5.3 |
| 9M 2023 | $1,250.5 | $449.5 | $90.8 |
Revenue by Market Segment
Revenue distribution by market segment for Q3 2024 is as follows:
| Market Segment | Revenue (in millions) | Percentage of Total Revenue |
|---|---|---|
| Semiconductor Equipment | $197.5 | 52.8% |
| Industrial and Medical | $76.8 | 20.5% |
| Data Center Computing | $80.7 | 21.6% |
| Telecom and Networking | $19.2 | 5.1% |
Cost Structure
The cost of revenue for Q3 2024 was $240.1 million, resulting in a gross margin of 35.8%. Operating expenses totaled $145.1 million, comprising:
- Research and Development: $53.6 million
- Selling, General, and Administrative: $56.2 million
- Amortization of Intangible Assets: $6.8 million
- Restructuring and Other Charges: $28.5 million
Liquidity and Capital Resources
As of September 30, 2024, AEIS had cash and cash equivalents totaling $657.3 million and an available credit facility of $600.0 million. The company generated $50.3 million in cash flow from operations in the nine months ended September 30, 2024.
Debt Structure
AEIS's outstanding debt as of September 30, 2024, includes:
- $575.0 million in Convertible Notes due September 15, 2028, with a 2.5% interest rate.
- No amounts outstanding under the Revolving Facility.
Recent Developments
AEIS has faced challenges in the Industrial and Medical market, with revenues declining 33.3% year-over-year, primarily due to inventory de-stocking by customers. Conversely, Data Center Computing revenues increased 18.1% as demand for AI-related infrastructure grew.
Shareholder Returns
During the nine months ended September 30, 2024, AEIS paid cash dividends of $0.10 per share, totaling $11.5 million.
How Advanced Energy Industries, Inc. (AEIS) Makes Money
Revenue Sources
Advanced Energy Industries, Inc. (AEIS) generates revenue primarily through four key market segments:
- Semiconductor Equipment
- Industrial and Medical
- Data Center Computing
- Telecom and Networking
As of September 30, 2024, the distribution of revenue across these segments is as follows:
| Market Segment | Q3 2024 Revenue (in thousands) | Q3 2023 Revenue (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Semiconductor Equipment | $197,497 | $185,033 | $12,464 | 6.7% |
| Industrial and Medical | $76,837 | $115,226 | $(38,389) | (33.3%) |
| Data Center Computing | $80,653 | $68,286 | $12,367 | 18.1% |
| Telecom and Networking | $19,230 | $41,446 | $(22,216) | (53.6%) |
| Total Revenue | $374,217 | $409,991 | $(35,774) | (8.7%) |
Financial Performance Overview
For the nine months ended September 30, 2024, AEIS reported total revenue of $1,066,639, down from $1,250,539 in the same period of 2023, reflecting a decline of $183,900 or 14.7%.
The revenue breakdown for the nine-month period is detailed below:
| Market Segment | 9M 2024 Revenue (in thousands) | 9M 2023 Revenue (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Semiconductor Equipment | $565,721 | $552,419 | $13,302 | 2.4% |
| Industrial and Medical | $239,359 | $365,849 | $(126,490) | (34.6%) |
| Data Center Computing | $195,519 | $187,021 | $8,498 | 4.5% |
| Telecom and Networking | $66,040 | $145,250 | $(79,210) | (54.5%) |
| Total Revenue | $1,066,639 | $1,250,539 | $(183,900) | (14.7%) |
Cost Structure
AEIS's cost of revenue for Q3 2024 was $240,149, compared to $262,650 in Q3 2023. This resulted in a gross profit of $134,068 for Q3 2024. The operating expenses for Q3 2024 totaled $145,116, which includes:
- Research and Development: $53,561
- Selling, General, and Administrative: $56,237
- Amortization of Intangible Assets: $6,772
- Restructuring, Asset Impairments, and Other Charges: $28,546
This resulted in an operating loss of $(11,048) for Q3 2024, compared to an operating income of $30,061 in Q3 2023.
Net Income
For the three months ended September 30, 2024, AEIS reported a net loss of $(14,905), compared to a net income of $32,721 in the same period of 2023.
International Revenue Distribution
Revenue by region for Q3 2024 is summarized as follows:
| Region | Revenue (in thousands) | Percentage of Total Revenue |
|---|---|---|
| North America | $175,691 | 47.0% |
| Asia | $163,212 | 43.6% |
| Europe | $34,892 | 9.3% |
| Other | $422 | 0.1% |
The total revenue of $374,217 for Q3 2024 reflects a diverse customer base across various geographic regions, with significant contributions from both North America and Asia.
Key Customers
During the three months ended September 30, 2024, the following customers were significant contributors to AEIS's revenue:
- Applied Materials, Inc.: 25% of total revenue
- Lam Research Corporation: 11% of total revenue
As of September 30, 2024, accounts receivable from Applied Materials, Inc. accounted for 28% of AEIS's total accounts receivable.
Advanced Energy Industries, Inc. (AEIS) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Article updated on 8 Nov 2024
Resources:
- Advanced Energy Industries, Inc. (AEIS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Advanced Energy Industries, Inc. (AEIS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Advanced Energy Industries, Inc. (AEIS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.