Nova Reports Record Q3 Results Amidst Chip Industry Boom

Nova, a manufacturer of metrology and inspection systems for the semiconductor industry, announced its third-quarter 2026 financial results on Thursday, revealing new records in revenue and profitability. The company reported revenues of $287.8 million, a 28% increase year-over-year and a 13% rise from the previous quarter. Net profit surged by 46.5% to $90 million. These results surpassed analyst expectations, which had predicted revenues of approximately $282.2 million and a non-GAAP earnings per share of $2.77. Nova actually posted a non-GAAP EPS of $2.86, up from $2.16 in the same quarter last year. Operating profit also saw a significant improvement, reaching $92.8 million, a 45.4% increase from the prior year, outpacing revenue growth. Gross profit margin rose to 57.7% from 56.7% in the comparable quarter.

The company's growth is being driven by the increasing demand for advanced chips. Notably, Nova achieved record revenues from its advanced packaging solutions, fueled by expanded production capacity for High Bandwidth Memory (HBM) and advanced logic chips. HBMs are crucial components in high-performance computing systems, particularly for AI accelerators. As chips become more complex, the need for precise measurement and control systems, like those provided by Nova, grows to enhance manufacturing quality and reduce defect rates. Nova also reported record revenue from its memory device segment, driven by demand for solutions measuring dimensions and material properties. These two areas are identified as key growth engines, indicating Nova is benefiting from investments in advanced semiconductor infrastructure.

Looking ahead, Nova forecasts fourth-quarter revenues between $305 million and $315 million, with the midpoint of $310 million representing an approximate 7.7% growth from the third quarter. The company anticipates a non-GAAP EPS of $3.03 to $3.18 per share. The revenue forecast exceeds the analyst estimate of around $306 million, though the midpoint of the EPS forecast is close to market expectations. If Nova meets its midpoint guidance, its total 2026 revenue is projected to reach approximately $1.09 billion, a significant increase from $881 million in 2025.

Another notable financial highlight is the nearly doubling of cash flow from operating activities, which reached $138.1 million in the third quarter, compared to $71.3 million in the same period last year, marking a nearly 94% jump and indicating a substantial improvement in the company's cash generation. Nova CEO Gabi Weismann described the quarter as exceptional, with record revenues and profitability, and highlighted the company's strengthened position in key growth areas of the semiconductor industry. He expressed confidence in Nova's ability to capitalize on advanced technological transitions in the sector, supported by improved visibility into customer investment plans.

Nova, traded on Nasdaq and the Tel Aviv Stock Exchange, develops process measurement and control systems used by chip manufacturers. Unlike chip designers, Nova provides the equipment essential for high-precision and improved-yield chip production.