10-QPeriod: Q1 FY2025

ENTEGRIS INC Quarterly Report for Q1 Ended Mar 29, 2025

Filed May 7, 2025For Securities:ENTG

Summary

Entegris, Inc. (ENTG) reported relatively stable net sales of $773.2 million for the three months ended March 29, 2025, a slight increase from $771.0 million in the prior year's comparable period. This stability was achieved despite the absence of sales from the divested Pipeline and Industrial Materials (PIM) business. The company experienced a modest increase in gross margin to 46.1% from 45.6%, attributed to improved plant performance. Operating expenses saw a notable decrease in Selling, General, and Administrative (SG&A) expenses, primarily due to the absence of a prior year's impairment charge and gain on sale of the PIM business. However, Engineering, Research, and Development (ER&D) expenses increased significantly, impacting operating income. Net income rose to $62.9 million ($0.41 per diluted share) from $45.3 million ($0.30 per diluted share) year-over-year, driven by these factors and a lower interest expense. The company's liquidity remains strong, with cash and cash equivalents of $340.9 million.

Financial Highlights

51 data points
Beta

Revenue

$773.20M

46.1% Gross Margin

Net Income

$62.90M

8.1% Net Margin

EPS (Diluted)

$0.41

Total Assets

$8.43B

Cash & Equivalents

$340.90M

Free Cash Flow

$32.40M

Financial Statements
Beta
Revenue$773.20M
Cost of Revenue$416.70M
Gross Profit$356.50M
R&D Expenses$84.80M
SG&A Expenses$103.30M
Operating Expenses$173.40M
Operating Income$122.30M
Interest Expense$51.00M
Net Income$62.90M
EPS (Basic)$0.42
EPS (Diluted)$0.41
Shares Outstanding (Basic)151.40M
Shares Outstanding (Diluted)152.00M

Key Highlights

  • 1Net sales remained nearly flat at $773.2 million for Q1 2025 compared to $771.0 million in Q1 2024, demonstrating resilience despite the divestiture of the PIM business.
  • 2Gross margin improved by 0.5 percentage points to 46.1% due to better plant performance.
  • 3SG&A expenses decreased by $8.9 million, largely due to the absence of a $13.0 million impairment charge and a $4.8 million gain on sale of PIM in the prior year.
  • 4ER&D expenses increased by $13.0 million to $84.8 million, indicating continued investment in product development and technology.
  • 5Net income increased by 38.9% to $62.9 million ($0.41 per diluted share) from $45.3 million ($0.30 per diluted share) in the prior year's quarter.
  • 6Operating cash flow slightly decreased to $140.4 million from $147.2 million, primarily due to changes in operating assets and liabilities.
  • 7The company maintained a strong liquidity position with cash and cash equivalents totaling $340.9 million as of March 29, 2025.

Frequently Asked Questions

The increase in net income was driven by a combination of factors including improved gross margin, a significant reduction in SG&A expenses (largely due to non-recurring items in the prior year), and lower interest expense. These improvements more than offset the increase in ER&D expenses.

The divestiture of the PIM business resulted in the absence of approximately $33.9 million in net sales compared to the prior year's quarter. While this impacted overall revenue, it also eliminated associated costs and a gain on sale from the prior year's results, contributing to the 'cleaner' year-over-year comparison of operating income and net income.

Entegris maintains a strong liquidity position with $340.9 million in cash and cash equivalents. The company believes its existing cash balances and anticipated operating cash flows are sufficient to meet its needs for the next twelve months and the longer term. They also have a $575 million revolving credit facility available if needed.

The company notes ongoing global trade tensions, particularly with China, which could increase sourcing and manufacturing costs and affect demand. Regarding accounting, Entegris is evaluating the impact of new pronouncements on income tax disclosures and expense disaggregation, but these are not expected to have a material impact in the current period.