ACM Research Q2 2026 earnings: ECP growth drives a 36% revenue increase

ACM Research (NASDAQ: ACMR) reported Q2 2026 revenue of $292.9 million, up 36.0% from $215.4 million, while GAAP diluted EPS rose to $1.23 from $0.44. Growth was led by ECP, furnace and other technologies, which more than offset lower revenue from the company’s cleaning equipment category. A $69.6 million unrealized investment gain amplified GAAP earnings, while adjusted diluted EPS increased more moderately to $0.61.

Core earnings data

Revenue grew faster than gross profit, resulting in a 250-basis-point decline in GAAP gross margin. However, operating expenses increased only 16.6%, well below revenue growth, reducing operating expenses to 29.0% of revenue from 33.8% and lifting GAAP operating margin.

The difference between GAAP and non-GAAP earnings was substantial because adjusted results exclude stock-based compensation and unrealized gains on short-term investments.

Business and product performance

ACM’s product mix shifted materially toward ECP, furnace and other technologies. That category generated most of the quarter’s incremental revenue, while advanced packaging, services and spares also expanded rapidly. In contrast, single-wafer cleaning, Tahoe and semi-critical cleaning equipment declined.

Total shipments increased 36.4% to $281.5 million. Shipments include both systems recognized as revenue during the quarter and initial tools awaiting customer acceptance that could contribute revenue in later periods.

ACM also shipped its 2,000th electroplating chamber, up from the 1,500-chamber milestone reached in 2025. In panel-level packaging, the company received a production order for a 510 × 515 mm Ultra ECP ap-p tool scheduled for delivery in the first half of 2027 and an evaluation order for a 310 × 310 mm tool scheduled for the fourth quarter of 2026. These orders support the product pipeline but do not represent Q2 revenue.

Profitability and balance sheet

GAAP gross margin declined to 46.0% but remained above the midpoint of ACM’s long-term target range of 42% to 48%. The company did not attribute the quarterly decline to a single cause, noting that product mix, currency movements and sales volume can produce period-to-period changes.

Operating leverage offset the lower gross margin. GAAP operating expenses rose 16.6% to $84.9 million, compared with 36.0% revenue growth. Research and development spending increased by about 25% to $42.3 million as ACM continued to support new product evaluations and ramps.

Liquidity also increased during the quarter. Cash and cash equivalents, restricted cash and short-term time deposits totaled $1.36 billion at June 30, up from $1.25 billion at March 31. Net cash increased to $1.0 billion from $924.2 million. Inventory reached $783.1 million, compared with $702.6 million at the end of 2025, making customer acceptance and inventory conversion important areas to monitor.

Investment gains amplified GAAP earnings while adjusted margins stayed steady

The $69.6 million unrealized gain on short-term investments, up from $2.7 million a year earlier, explains much of the gap between the nearly threefold increase in GAAP net income and the 19.3% increase in adjusted net income. The gain reflects quarterly mark-to-market changes in investments held by ACM Research Shanghai and is excluded from the company’s non-GAAP results.

At the operating level, non-GAAP operating income rose about 35.8% to $56.3 million, nearly matching revenue growth. As a result, non-GAAP operating margin was effectively unchanged at 19.2%, versus 19.3% a year earlier. Weighted average diluted shares also increased by about 6.5%, contributing to adjusted EPS growth trailing adjusted net income growth.

2026 guidance

ACM raised the lower end of its fiscal 2026 revenue outlook by $45 million while leaving the upper end unchanged. The update narrows the range and lifts its midpoint by about $22.5 million.

The latest range represents anticipated revenue growth of 25% to 30%. Management said the outlook incorporates international trade policy, spending scenarios for major customers, supply-chain constraints and the timing of customer acceptance for initial tools under evaluation.

Management perspective

Management said increased order activity provides visibility for the remainder of 2026. ACM is progressing with customer evaluations and product ramps across SPM Cleaning, Track, PECVD and horizontal panel-level plating for advanced packaging.

The company is also expanding its engagement with global customers and continuing work at its Oregon facility. Management expects new product cycles, market-share gains and contributions from global markets to support progress toward its long-term revenue target of $4 billion, although no timeframe for that target was provided.

Recent insider transactions

The supplied six-month summary classified 437,303 shares as purchases and the same number as sales across 10 transactions in each direction, resulting in zero net shares purchased or sold. Several recent sales were reported on the same dates as derivative-security conversions, and the disclosures do not indicate the insiders’ reasons for transacting.

Risks investors should watch

• Product mix and category divergence: ECP and advanced packaging drove growth, while the cleaning equipment category declined about 14%. Changes in the pace or mix of these businesses could affect both revenue growth and gross margin.
• Customer acceptance timing: Shipments include initial systems that cannot be recognized as revenue until customers accept them. Delays could shift revenue between quarters and slow inventory conversion.
• Trade, supply-chain and customer spending exposure: ACM explicitly incorporated international trade policy, supply constraints and different spending scenarios for key customers into its guidance.
• GAAP earnings volatility: Short-term investments are marked to market quarterly. The resulting unrealized gains or losses can cause reported net income and EPS to move differently from operating performance.

Summary

ACM Research’s Q2 2026 growth was driven by a pronounced shift toward ECP, furnace and advanced-packaging-related products. Operating expense leverage improved GAAP operating margin despite a lower gross margin, but the surge in reported net income was heavily influenced by an unrealized investment gain. The higher full-year guidance floor, customer acceptance timing, cleaning equipment performance and stability of the new product mix are the main items to monitor in coming quarters.