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Call sheet · Q4'25

MKS Instruments (MKSI)

Q4'25 earnings call · held February 18, 2026 · compared with the Q3'25 call · management-credibility review
6/12
Disclosure score
2 high, 3 medium, 2 low flags
Financial quality
Bottom line
The sleeper story is that MKS has locked in 2+ years of chemistry revenue growth that nobody's modeling, with equipment factories full through H1'26 and an 18-24 month conversion to recurring chemistry sales at 80%+ gross margins. The Street sees 'semi recovery participation' but misses that E&P is becoming the real growth engine, with AI chemistry revenue doubling YoY to 10% of mix. The binding constraint isn't demand, it's their unwillingness to provide visibility; management went dark on bookings, DSO, and free cash flow in the same quarter they claimed 'record' performance. Most revealing quote: 'We're not going to guide bookings going forward in equipment' after five quarters of touting strength. My view changes if they restore financial disclosure transparency or if chemistry equipment bookings actually peaked in Q4.

The 30-second version

  • Chemistry equipment factory is 'full through' H1'26, setting up a multi-year chemistry revenue stream nobody's modeling
  • Semi revenue guide implies WFE outperformance is starting NOW, not H2'26
  • Management stopped disclosing DSO and chemistry equipment bookings after 'record' claims

What changed this quarter

MetricQ3'25Q4'25Change
Revenue$988M (YoY +10%)$1,030M (YoY +10%)+4.3% QoQ acceleration
EPS$1.93 (YoY +14%)$2.47 (YoY +20%)+28% QoQ surge
Operating Income$205M (20.8% margin)$217M (21.0% margin)+20 bps margin expansion
Free Cash Flow$147M (100% conversion)Not disclosedMetric disappeared
Semi Revenue$415M (YoY +10%)$435M (YoY +9%)YoY deceleration
E&P Revenue$289M (YoY +25%)$303M (YoY +19%)600 bps YoY deceleration
Chemistry Sales ex-FX+10% YoY+16% YoY+600 bps acceleration
Gross Margin46.6%46.4%20 bps compression
Net Leverage Ratio3.9x3.7x20 bps improvement
Operating Cash Flow$147M quarterly$645M full year21% YoY growth

Accountability tracked

6 new promises made4 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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