ACM Research, Inc. (ACMR) Q2 2026 Earnings: Revenue $293M (+36.0%)
ACMR — Q2 2026 Financial Report Analysis
Q2 · Fiscal year 2026 · Published by Pham Hop
ACM Research's Q2 2026 revenue rose 36% to $292.9M on a tripling of its plating and furnace tool sales, but half of its $1.23 GAAP EPS came from a markup on Shanghai-listed shares; adjusted EPS rose 11% to $0.61 and full-year guidance was raised to $1.125–$1.175B.
Revenue
$293M
+36.0% YoY
Net income
$89M
+199.0% YoY
Diluted EPS
$1.23
+179.5% YoY
Operating margin
17.0%
This period vs a year ago
Same period last year
This period
Revenue▲+36.0%
≈$215M
$293M
Net income▲+199.0%
≈$30M
$89M
Diluted EPS▲+179.5%
≈$0.44
$1.23
Year-ago figures (≈) are worked out from the growth rate the company reported. Each row has its own scale.
Overview
ACM Research makes the machines chip factories use to clean silicon wafers, plate them with copper (electroplating, or "ECP"), and heat-treat them in furnaces. Almost all of its manufacturing and sales run through ACM Research (Shanghai), a subsidiary that is itself listed in Shanghai and of which the US parent owns 73.2%. In the quarter ended June 30, 2026, revenue rose 36.0% to $292.9 million, driven almost entirely by product lines other than its original cleaning tools: ECP, furnace and other tools grew 168%, while cleaning tools actually shrank 14%. Headline profit nearly tripled to $89.0 million ($1.23 per diluted share), but about half of that came from a jump in the market value of Shanghai-listed shares the company holds, not from selling equipment.
At a glance
Revenue $292.9M, up 36.0%. The growth came from newer product lines. Cleaning tools, the original business, brought in $22.0M less than a year earlier.
Diluted EPS $1.23 vs. $0.44. The company's own adjusted figure, which strips out investment gains and stock-based pay, was $0.61 vs. $0.55, up about 11%. That is the better guide to how the equipment business itself did.
Full-year 2026 revenue outlook raised to $1.125–$1.175 billion (previously $1.08–$1.175 billion). Management describes this as 25%–30% growth.
The numbers
Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$292.9M
$215.4M
+36.0%
Gross margin
46.0%
48.5%
-2.5 pts
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Operating income
$49.7M
$31.7M
+56.9%
Operating margin
17.0%
14.7%
+2.3 pts
Net income attributable to ACM Research
$89.0M
$29.8M
+199.0%
Diluted EPS (GAAP)
$1.23
$0.44
+179.5%
Diluted EPS (non-GAAP)
$0.61
$0.55
+10.9%
Shipments
$281.5M
n/a
+36.4%
Unrealized gain on short-term investments
$69.6M
$2.7M
n/m
Gross margin is the share of revenue left after the direct cost of building the tools. Operating margin is the share left after also paying for research, sales and administration, before interest, investment gains and tax. Shipments include tools delivered to customers for evaluation that have not been counted as revenue yet.
Where the growth came from
Product category
Q2 2026
Q2 2025
YoY Change
Single wafer cleaning, Tahoe and semi-critical cleaning
$133.0M
$155.0M
-14.2%
ECP (front-end and packaging), furnace and other technologies
$128.5M
$48.0M
+167.7%
Advanced packaging (excl. ECP), services & spares
$31.4M
$12.4M
+153.3%
A year ago cleaning tools made up 72% of revenue. This quarter they made up 45%, and plating and furnace tools almost matched them. The 10-Q attributes the overall increase to "a longer-term commitment by our mainland China-based customers to increase production capacity... together with the market share changes and product cycles." The earnings release says ACM shipped its 2,000th electroplating chamber this quarter, up from 1,500 at some point in 2025. That pace fits with the ECP line tripling.
This change in mix is also the main reason gross margin slipped from 48.5% to 46.0%. The 10-Q puts the decline "primarily due to revenue mix between product categories." The newer tool lines seem to earn less per dollar of sales than the established cleaning line, at least for now. Management's stated long-term range for gross margin is 42%–48%, so 46.0% is still inside it.
Even so, operating margin improved from 14.7% to 17.0% because costs grew more slowly than sales. Operating expenses rose 16.6% to $84.9M against 36% revenue growth. Research and development was the largest cost and grew fastest, up $8.4M to $42.3M, mostly from more staff and from parts for development tools. Stock-based pay also fell, from $9.8M to $6.6M in total, which helped the GAAP operating line.
What the headline numbers hide
About half of GAAP profit came from outside the business. Three non-operating items added up to roughly $80M before tax and minority share. The first was a $69.6M unrealized gain on short-term investments, which the 10-Q attributes to "a significant increase... in the market price of certain of our holdings of publicly traded stocks which are listed on the Shanghai Stock Exchange". "Unrealized" means the shares were marked up in value but not sold. The second was $21.1M of income from equity-method investments (companies ACM owns a minority stake in), which "mainly derived from gain on disposal of available-for-sale securities held by our equity method investee." The third pulled the other way: a $10.9M foreign-exchange loss on working capital as the Chinese yuan moved against the dollar. Unrealized gains can reverse when share prices fall. That is why the company's own non-GAAP net income, which excludes the markup and stock pay, rose a more modest 19.3%, to $44.5M from $37.3M.
Minority owners take a growing share. Because ACM owns 73.2% of ACM Shanghai, the other Shanghai shareholders are entitled to $33.3M of this quarter's $122.3M consolidated net income. ACM's stake also shrank from 73.6% at March 31. In February the parent sold about 4.8M ACM Shanghai shares for $110.2M gross ($86.0M after tax), and ACM Shanghai employees then exercised stock options. ACM Shanghai has also approved a plan for a Hong Kong listing of new shares worth up to 7% of its share capital. It still needs shareholder approval, and if it goes ahead the parent's stake would fall further.
More shares, not fewer. Diluted share count rose 6.5% to 71.8M. The main cause was a May 2026 registered direct offering of about 2.9M Class A shares at $52.00, which raised $148.4M net. EPS growth therefore came entirely from profit growth. None of it came from buybacks, and a larger share count held EPS back somewhat.
The tax rate rose. Income tax was 9.9% of pre-tax income vs. 5.0% a year ago ($13.5M vs. $1.9M), so tax flattered nothing this year.
Cash flow is weak, but it has been weak before. Operating cash flow for the first half was -$35.9M, even though first-half net income was $148.5M. Part of the gap is the $68.2M of paper investment gains and $22.8M of equity-method income, which bring in no cash. The rest went into working capital: inventory used $69.9M of cash and customer advance payments fell by $25.9M. Capital spending jumped to $87.3M from $31.5M, which included buying a Shanghai office building for $45.9M, part-financed with a $34.0M bank loan. Free cash flow (operating cash flow minus capital spending and investment purchases) was -$127.9M vs. -$71.1M in the first half of 2025. The balance sheet can absorb this: cash, restricted cash and time deposits totalled $1.36B, and net cash after all borrowings was $1.0B. But that cash pile grew mostly through $332.6M of financing, not through operations.
Inventory and receivables. Inventory rose 11.5% since December to $783.1M, and the provision for inventory write-downs doubled to $12.0M in the first half from $5.6M. Receivables rose only 6.8% to $538.4M, well below sales growth, so collections look fine. Customer prepayments ("advances from customers") fell to $165.6M from $187.8M. That seems at odds with management's comment about "increased order activity" and is worth watching.
Customer concentration eased. Three customers made up 43.5% of revenue this quarter, vs. four customers making up 66.5% a year earlier. Revenue still comes almost entirely from mainland China: the 10-Q says "substantially all revenue was derived from customers in mainland China."
Takeaway: ACM's growth now depends on its plating, furnace and packaging tools, not on the cleaning tools it built its name on. Those newer lines tripled in a quarter when cleaning revenue fell 14%. Ignore the $1.23 headline EPS. Adjusted EPS of $0.61, up 11%, and a first half that burned $127.9M of free cash give a truer picture: a business growing fast in revenue, but converting less of it into cash.
China and export controls
The US-listed parent owns a majority of ACM Shanghai directly, not through a "variable interest entity" (VIE), the contract-based structure many China-based US listings use. The 10-Q states plainly that ACM is "not a mainland China operating company" and does not use a VIE. The main policy risk is instead the US export blacklist. In December 2024 the Commerce Department added ACM Shanghai and ACM Korea to the BIS Entity List, which bars anyone from supplying them US-controlled hardware, software or technology without a licence. Revenue still grew 36% after that listing, which suggests customer demand in China has so far outweighed the restriction. The risk of further rules remains, and management's guidance explicitly rests on its "current assessment of the continuing impact from international trade policy."
Outlook
Management raised the bottom of its 2026 revenue range, from $1.08B to $1.125B, and left the top at $1.175B. First-half revenue was $524.2M. Hitting the new range therefore means second-half revenue of roughly $601M–$651M, or 15%–24% above the first half. That is a real step up, and it relies on what CEO David Wang calls a "Big Year" for new products: customer evaluations and ramps in SPM cleaning, Track, PECVD and horizontal panel-level plating. The company also received a first production order for its large-panel Ultra ECP ap-p plating tool, with delivery scheduled for the first half of 2027. Gross margin guidance is unchanged at 42%–48%.
Our read: the move from cleaning into plating and furnaces is showing up in revenue faster than we would have expected from a company this concentrated. The next two quarters should answer three questions. Does cleaning revenue stabilise, or keep shrinking as other lines take over? Does gross margin hold above the mid-40s as the mix shifts? Does inventory, including tools sitting at customers awaiting acceptance, turn into revenue and cash? GAAP EPS will keep swinging with Shanghai share prices. Use the adjusted figure and cash flow to judge the business.
This is the first ACM Research report we have published, so there is no earlier forecast of ours to check against. The 10-Q is the full filing, and all figures above come from it and from the same-day earnings release.