Ultra Clean (UCTT) investor relations material

Executive summary

• Q4 2025 revenue reached $506.6 million, with Products at $442.4 million and Services at $64.2 million.

• Entering a structural expansion in wafer fab equipment (WFE) driven by AI infrastructure and physical AI demand, with a multi-year upturn expected as the industry shifts from consumer electronics to AI applications.

• Strategic transformation (UCT 3.0) focuses on ramp readiness, operational agility, and digital transformation to support rapid growth and customer needs.

• Results reflect a $151.1 million pre-tax, non-cash goodwill impairment charge in 2025.

• Operating cash flow for Q4 2025 was $8.1 million, and cash balance stood at $311.8 million.

Financial highlights

• Q4 2025 gross margin was 16.1% non-GAAP and 15.2% GAAP; operating margin was 4.9% non-GAAP and 2.2% GAAP.

• Q4 net income was $10.0 million non-GAAP (EPS $0.22), with a GAAP net loss of $3.3 million (EPS $(0.07)).

• Full year 2025 revenue was $2.1 billion, with non-GAAP net income of $47.7 million (EPS $1.05) and a GAAP net loss of $181.2 million (EPS $(4.00)).

• Cash and equivalents at year-end were $311.8 million; full-year cash flow from operations was $65.6 million.

• Q4 2025 effective GAAP tax rate was 130.0%; non-GAAP tax rate was 21.0%.

Outlook and guidance

• Q1 2026 revenue projected at $505–$545 million; non-GAAP EPS guidance is $0.18–$0.34.

• GAAP diluted EPS guidance for Q1 2026 is $(0.13) to $0.03.

• Expect gross margins in Q1 to be roughly flat or slightly up from Q4, with sequential margin expansion through the year as utilization rises.

• WFE market forecasted to grow 15–20% year-over-year, with company revenue growth expected to match or exceed WFE growth, especially in the second half of 2026.

• Second half of 2026 expected to see a step-function increase in demand and revenue.