Onto Innovation Q3 Earnings Call Highlights Onto Innovation logo MarketBeat Tue, November 10, 2026 at 12:14 AM EST 5 min read ONTO +17.38% ^IXIC +2.74% Trade ONTO on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Strike a Balance Between Growth and Stability With These 3 Names Ready to Rally
Onto Innovation (NYSE:ONTO) reported third-quarter revenue of $410 million, up 19% from the previous quarter and nearly 90% from a year earlier, as demand for semiconductor inspection and metrology equipment fueled growth across advanced packaging and chipmaking markets.
The company raised its fourth-quarter revenue outlook to $430 million to $450 million and said it expects sequential revenue growth through at least the first half of 2027. Chief Executive Officer Michael Plisinski said backlog had increased another 20% to more than $1.3 billion as of the call, providing visibility into 2027 and, in some cases, 2028 and beyond.
→ Airbnb Defied a Brutal Tech Sell-Off, But Can Its Post-Earnings Rally Last?
The Nasdaq's Historic Rally Doesn't Mean the Risk Is Gone
"Chip demand remains strong, visibility has never been better, and our product portfolio across the value chain has never been stronger," Plisinski said. He added that the company had not seen customers slow their orders despite questions about data center spending.
Third-quarter revenue, operating margin and earnings per share all exceeded the high end of Onto's guidance, Plisinski said. The company reported earnings of $2.44 per share, up 26% from the second quarter.
→ IonQ's Record Revenue Includes a Big SkyWater Boost: Does That Change the Story?
Is AI Really Eating Software? A Wall Street Veteran Says No—Here's Why
Gross margin rose 60 basis points sequentially to 57.6%, while operating margin increased to 32.6% from 30% in the preceding quarter. Management said the call's financial discussion was presented on a non-GAAP basis unless otherwise specified.
For the fourth quarter, Onto expects gross margin to rise by another half a percentage point to slightly above 58%. At the midpoint of its revenue forecast, the company anticipates an operating margin of 34% and earnings of $2.69 per share. That outlook assumes a non-GAAP tax rate of about 16% and approximately 50 million shares outstanding.
→ Sandisk Shares Are Oversold: Bargain or Value Trap?
At the midpoint of its fourth-quarter guidance, Onto expects full-year revenue of $1.485 billion, representing growth of more than 45%, Chief Financial Officer Brian Roberts said.
Advanced packaging and specialty device products generated 35% sequential revenue growth and accounted for a little over half of third-quarter revenue, Roberts said. The company expects advanced packaging revenue to increase more than 80% in 2026, with growth relatively evenly split between 2.5D logic and high-bandwidth memory, or HBM.
Plisinski said the Dragonfly G5 inspection platform has reached more than 10 customers since its launch earlier this year. Purchase orders for 2027 already represent twice the platform's 2026 revenue, he said, while requests for new applications doubled during the third quarter.
Revenue from Onto's 3Di interconnect metrology technology through the third quarter had already more than doubled its full-year 2025 level, Plisinski said. He expects fourth-quarter 3Di revenue to exceed the combined total from the first three quarters of 2026, citing repeat customer orders and new applications.
The company also expects panel revenue to double in 2026, with backlog supporting growth of more than 40% in 2027. Plisinski clarified that those forecasts referred to JetStep lithography tools.
Advanced-node revenue was approximately $135 million in the third quarter, with about 60% coming from memory and 40% from logic, Roberts said. Software and services contributed the remaining $60 million.
Onto expects advanced-node revenue to grow more than 35% in 2026 and at a faster rate in 2027. Plisinski pointed to adoption of the Atlas G6 metrology platform and greater use of measurements taken directly within chip structures. He said the company has the greatest confidence in logic and DRAM demand, though it also expects NAND to contribute growth.
Roberts said the company had anticipated some fourth-quarter deceleration in advanced-node revenue. Plisinski said he expects advanced packaging revenue to grow more than 35% in 2027, while the company plans to provide more detail toward year-end.
On margins, Roberts said an average improvement of roughly 50 basis points per quarter was a reasonable way to think about 2027, although the company will formalize its plans later. Plisinski said Onto faces higher supply-chain costs, including for memory, but is making design changes to reduce usage where possible.
Onto ended September with approximately $1.25 billion in cash and short-term investments after generating about $80 million in quarterly free cash flow and paying $720 million in August for a 27% investment in Rigaku, Roberts said.
The company recognized an approximately $40 million unrealized loss on the investment. Roberts said Onto will mark the holding to market each quarter in its GAAP results and exclude unrealized gains or losses and their associated tax effects from non-GAAP results.
Onto Innovation develops process-control and inspection solutions used in semiconductor manufacturing. Its products include metrology and inspection systems, lithography equipment, and software that help manufacturers monitor production processes and identify defects.
The company serves producers of semiconductor devices, advanced packaging, and specialty components. Its technologies support applications ranging from traditional wafer fabrication to newer packaging methods used in complex chips.
Onto Innovation was formed in 2019 through the merger of Nanometrics and Rudolph Technologies.
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
The article "Onto Innovation Q3 Earnings Call Highlights" was originally published by MarketBeat.
View MarketBeat's top stocks for November 2026.
