The Top 5 Analyst Questions From Nova's Q1 Earnings Call
Is now the time to buy NVMI? Find out in our full research report (it's free).
Revenue: $213.4 million vs analyst estimates of $210.2 million (50.5% year-on-year growth, 1.5% beat)
Adjusted EPS: $2.18 vs analyst estimates of $2.09 (4.4% beat)
Adjusted EBITDA: $76.72 million vs analyst estimates of $73.62 million (36% margin, 4.2% beat)
Revenue Guidance for Q2 CY2025 is $215 million at the midpoint, above analyst estimates of $211.7 million
Adjusted EPS guidance for Q2 CY2025 is $2.05 at the midpoint, below analyst estimates of $2.10
Operating Margin: 29.6%, up from 26.2% in the same quarter last year
Inventory Days Outstanding: 177, up from 168 in the previous quarter
Market Capitalization: $7.87 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Ezra Weener (Jefferies) asked about the trajectory of gate-all-around revenue growth and its transition from pilot to high-volume manufacturing. CEO Gaby Waisman indicated the ramp is progressing as planned and expects business from this segment to be higher next year.
Atif Malik (Citi) probed the degree of cross-selling between advanced packaging and gate-all-around customers. Waisman described double-digit growth in advanced packaging and highlighted Sentronics' contribution to this market segment.
Atif Malik (Citi) followed up on the impact of tariffs on revenue in China and on service growth. CFO Guy Kizner confirmed that tariffs primarily affect gross margin, not revenue, and reiterated service growth targets of 10-15% for the year.
Mark Lipacis (Evercore) sought clarification on the nature and geographic source of tariff impacts. Kizner explained that tariffs mainly affect the bill of materials and spare parts shipped between regions, due to Nova's mostly localized supply chain.
Charles Shi (Needham & Company) questioned Nova's outlook for China and visibility into the second half of the year. Waisman said China revenue is expected to be flat or slightly down, but highlighted backlog strength and offsetting growth elsewhere.
In coming quarters, the StockStory team will closely watch (1) whether Nova's advanced node and packaging solutions continue to gain market share, (2) how effectively the company manages margin headwinds from tariffs and supply chain shifts, and (3) progress on integrating Sentronics and expanding direct sales in Europe. The evolution of demand from China and customer investment in AI-related manufacturing will also be important signposts.
Nova currently trades at $277, up from $201.53 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it's free).
Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
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