Veeco Instruments Faces Dual Challenges: Export Snags and Merger Vote

Veeco Instruments US9224171002

The semiconductor equipment manufacturer Veeco Instruments is navigating a critical period marked by regulatory hurdles and a pivotal corporate decision. As the company advances toward a strategic merger with Axcelis Technologies, unexpected export controls are applying pressure to its short-term financial performance.

Veeco has disclosed to regulators that two of its laser annealing systems, destined for a client in China and valued at approximately $15 million, are currently detained at the port of San Francisco. U.S. Customs and Border Protection, alongside the Bureau of Industry and Security, have withheld export licenses for the equipment.

This logistical blockade presents a direct threat to the company's fourth-quarter 2025 targets. If the shipment is not cleared in time for the fiscal year's reporting close, Veeco anticipates it will fall short of its prior revenue and earnings-per-share forecast for the period. The incident underscores the vulnerability of semiconductor supply chains to ongoing trade tensions between the United States and China, raising questions about the long-term stability of such cross-border transactions.

Shareholder Decision Looms on Axcelis Merger

Running parallel to these operational difficulties is the progressing merger plan with Axcelis Technologies. Following regulatory approvals from authorities in the United Kingdom and Sweden in January, the final shareholder vote for both companies is scheduled for Friday, February 6.

Influential proxy advisory firms ISS and Glass Lewis have both issued recommendations for investors to vote in favor of the combination. Despite this support, a significant regulatory condition remains unmet: clearance from China's State Administration for Market Regulation (SAMR) is still pending. Assuming shareholder approval and the satisfaction of all regulatory requirements, the transaction is projected to close in the second half of 2026.

Clarity Awaits with Earnings Release

Investors seeking clarity on the financial impact of the detained shipments will receive a definitive update on February 11. Veeco is set to announce its fourth-quarter and full-year 2025 results before the market opens, revealing whether the $15 million revenue risk was realized or if the company managed to uphold its guidance.

• $15 million in revenue is at risk due to the customs hold in San Francisco.
• A crucial shareholder vote on the Axcelis merger is set for Friday, February 6.
• Quarterly earnings will be published on February 11, before trading begins.