Advanced Energy Industries (AEIS) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue rose 26% year-over-year to $511 million, exceeding guidance, with record Data Center Computing revenue more than doubling year-over-year and strong Semiconductor performance.

• Non-GAAP EPS was $2.09, up 70% year-over-year; GAAP EPS from continuing operations was $1.59, both above guidance midpoint.

• Gross margin surpassed 40% non-GAAP for the first time, reflecting manufacturing efficiency and product differentiation.

• Operating income reached a record $98 million non-GAAP, with net income rising to $67 million GAAP.

• Demand is robust across all markets, with raised full-year revenue growth targets and a strong design win pipeline expected to drive future growth.

Financial highlights

• Q1 2026 revenue: $511 million, up 26% year-over-year and ahead of guidance.

• Non-GAAP gross margin: 40.1%, up 220 basis points year-over-year; GAAP gross margin: 39.3%.

• Non-GAAP operating margin: 19.1%; GAAP operating margin: 13.4%.

• Non-GAAP EPS: $2.09, up 70% year-over-year; GAAP EPS: $1.59, up 145% year-over-year.

• Cash and equivalents: $699.5–$700 million; net cash: $131 million.

Outlook and guidance

• Q2 2026 revenue guidance: $540 million ±$20 million; non-GAAP EPS: $2.18 ±$0.25; GAAP EPS: $1.54 ±$0.23.

• Full-year 2026 revenue growth target raised to low-to-mid 20% range; Data Center growth outlook raised to mid-30%.

• Semiconductor revenue expected to accelerate in 2H 2026, up over 30% year-over-year.

• Free cash flow for 2026 targeted at or above 2025 levels despite higher CapEx.

• Management expects continued strong demand in Data Center Computing and ongoing recovery in Industrial and Medical markets.