Ultra Clean Reports Third Quarter 2026 Financial Results

Inventories increased to $723.3 million from $390.9 million at year-end, while cash declined and long-term debt increased.

Rhea-AI Summary

Ultra Clean Holdings (Nasdaq: UCTT) reported record third-quarter 2026 revenue of $759 million, alongside higher earnings and margins than the prior quarter. Revenue rose 18% sequentially and 49% year over year for the quarter ended September 25, 2026. Products revenue was $681.9 million and Services revenue was $77.1 million.

GAAP net income attributable to UCT reached $39.1 million, or $0.85 per diluted share, versus $8.7 million, or $0.19, in the prior quarter. GAAP gross margin increased to 16.9% from 16.1%, while operating margin rose to 7.1% from 4.6%. Non-GAAP diluted earnings were $1.15 per share, versus $0.70.

The company expects fourth-quarter revenue of $800 million to $860 million and GAAP diluted earnings of $1.02 to $1.26 per share. Nine-month operating cash outflow was $116.7 million, compared with $57.5 million of inflow a year earlier.

20 points · 2 major

PositiveiHow this balance works

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How the balance worksHow Sentiment works

0 major · 13 points

Hollow bars mark forward-looking points. How the balance works

Positive

• Major pointNine-month convertible-note issuance provided $600.0 million in financing proceeds. 28% of market cap
• Major pointNine-month bank-borrowing principal payments totaled $481.5 million. 23% of market cap
• Moderate pointThird-quarter revenue reached $759 million, up 18% sequentially and 49% year over year.
• Moderate pointThird-quarter GAAP net income reached $39.1 million, versus $8.7 million sequentially and a $10.9 million year-earlier loss.
• Moderate pointThird-quarter GAAP operating margin rose to 7.1%, versus 4.6% sequentially and 2.1% a year earlier.
• Moderate point. Forward-looking: it has not happened yet and may not happen.Fourth-quarter revenue is expected at $800 million to $860 million.
• Moderate pointNine-month common-stock repurchases totaled $40.0 million, versus $3.4 million a year earlier. 1.9% of market cap
• Moderate pointNine-month revolving-credit borrowings provided $50.0 million in funding. 2.4% of market cap
• Moderate pointNine-month at-the-market stock issuance raised $34.0 million, net of commissions and fees. 1.6% of market cap

11 minor points

• Minor pointThird-quarter GAAP diluted EPS reached $0.85, versus $0.19 sequentially and a $0.24 year-earlier loss.
• Minor pointThird-quarter GAAP gross margin increased to 16.9% from 16.1% in the prior quarter.
• Minor pointProducts revenue increased to $681.9 million from $445.0 million in the year-earlier quarter.
• Minor pointServices revenue increased to $77.1 million from $65.0 million in the year-earlier quarter.
• Minor point. Forward-looking: it has not happened yet and may not happen.Fourth-quarter GAAP diluted EPS is expected at $1.02 to $1.26.
• Minor point. Forward-looking: it has not happened yet and may not happen.Fourth-quarter non-GAAP diluted EPS is expected at $1.11 to $1.35.
• Minor pointNine-month revenue increased to $1,937.6 million from $1,547.3 million a year earlier.
• Minor pointNine-month GAAP net income attributable to UCT reached $29.9 million, versus a $177.9 million year-earlier loss.
• Minor pointNine-month GAAP diluted EPS reached $0.65, versus a $3.93 year-earlier loss.
• Minor pointThird-quarter interest expense declined to $1.5 million from $9.9 million a year earlier.
• Minor pointThird-quarter restructuring charges declined to $0.6 million from $7.1 million a year earlier.

Negative

• Moderate pointNine-month operating cash flow turned to a $116.7 million outflow from a $57.5 million year-earlier inflow.
• Moderate pointInventories increased to $723.3 million at September 25, 2026, from $390.9 million at December 26, 2025.
• Moderate pointLong-term debt increased to $635.1 million at September 25, 2026, from $467.0 million at December 26, 2025.
• Moderate pointNine-month at-the-market common-stock issuance added shares, diluting existing holders.
• Minor pointCash declined to $270.9 million at September 25, 2026, from $311.8 million at December 26, 2025.

8 minor points

• Minor pointAccounts receivable increased to $272.4 million at September 25, 2026, from $208.8 million at December 26, 2025.
• Minor pointNine-month capital expenditures increased to $45.3 million from $40.2 million a year earlier.
• Minor pointNine-month debt issuance costs required $17.4 million in cash payments.
• Minor pointNine-month capped call transactions required $25.1 million in cash payments.
• Minor pointNine-month debt extinguishment recorded a $3.4 million loss.
• Minor pointThird-quarter stock-based compensation increased to $6.9 million from $4.6 million a year earlier.
• Minor pointThird-quarter unrealized foreign-exchange loss was $2.6 million, versus a $2.4 million year-earlier gain.
• Minor pointThird-quarter legal-related costs increased to $0.6 million from $0.2 million a year earlier.

News Explained

The release reports net ATM and convertible-note proceeds and long-term debt as of 25 September 2026.

Ultra Clean reported completed third-quarter 2026 results; its nine-month cash-flow statement records net proceeds from common-stock issuance under an at-the-market offering, which increases the share count and reduces existing holders’ percentage ownership absent offsetting changes.

An at-the-market program lets an issuer sell new shares gradually into the open market at prevailing prices rather than in a single priced transaction.

The same nine-month cash-flow statement records proceeds from convertible-note issuance and revolving-credit borrowings, principal payments on bank borrowings, and common-stock repurchases.

At September 25, 2026, long-term debt and cash and equivalents were reported, alongside comparative balances at December 26, 2025.

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Key Figures

Revenue: $759 million GAAP gross margin: 16.9% GAAP diluted EPS: $0.85 +5 more

Revenue

$759 million

Q3 2026; record revenue, up 18% from Q2 2026 and 49% from Q3 2025

GAAP gross margin

16.9%

Q3 2026; compared with 16.1% in Q2 2026

GAAP diluted EPS

$0.85

Q3 2026; compared with $0.19 in Q2 2026

Non-GAAP diluted EPS

$1.15

Q3 2026; compared with $0.70 in Q2 2026

GAAP net income attributable to UCT

$39.1 million

Q3 2026; compared with $8.7 million in Q2 2026

Revenue outlook

$800 million to $860 million

Q4 2026

GAAP diluted EPS outlook

$1.02 to $1.26

Q4 2026

Non-GAAP diluted EPS outlook

$1.11 to $1.35

Q4 2026

Previous Earnings Reports

1 past event · Latest: Aug 03

Same Type 1 event

1. Aug 03

   Q2 earnings report

   24h Move

   -5.2%

   Reported Q2 results and issued Q3 guidance, providing a comparable revenue benchmark for current Q3 results.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

gaap, non-gaap, diluted share, at-the-market offering, +1 more

5 terms

gaap financial

"GAAP gross margin of 16.9%"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

View in glossary

non-gaap financial

"non-GAAP gross margin of 17.3%"

Non-GAAP refers to financial measures that companies use to show their earnings or performance without including certain expenses or income that are often added back to give a different picture. It matters because it can make a company's results look better or more favorable, but it may also hide important costs, so investors need to look at both GAAP (official rules) and non-GAAP numbers to get a full understanding.

View in glossary

diluted share financial

"$0.85 per diluted share"

Diluted share count is the total number of company shares that would exist if all potential claims that can become stock—such as employee stock options, warrants and convertible bonds—were exercised or converted. Investors use diluted shares to see a more conservative view of ownership and per-share metrics (like earnings per share), because it’s like slicing a cake into more pieces: the same profit spread over more slices makes each slice smaller.

at-the-market offering financial

"issuance of common stock under at-the-market offering"

An at-the-market offering is a method companies use to sell new shares of stock directly into the open market over time, rather than all at once. This allows them to raise money gradually, similar to selling small pieces of a product instead of a large batch. For investors, it means the company can access funding more flexibly, but it may also increase the supply of shares and influence the stock’s price.

convertible notes financial

"Proceeds from the issuance of convertible notes"

Convertible notes are a type of short-term loan that a company receives from investors, which can later be turned into company shares instead of being paid back in cash. They matter to investors because they offer a way to support a company early on while giving the potential to own a stake in its success if the company grows and later raises more funding.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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HAYWARD, Calif., Oct. 27, 2026 /PRNewswire/ -- Ultra Clean Holdings, Inc. (Nasdaq: UCTT), today reported its financial results for the third quarter ended September 25, 2026.

Highlights for the Third Quarter 2026 were as follows:

• Record revenue of $759 million, up 18% compared to Q2 2026 and up 49% compared to Q3 2025.
• GAAP gross margin of 16.9% and non-GAAP gross margin of 17.3%.
• GAAP EPS of $0.85 and non-GAAP EPS of $1.15.

"UCT delivered another strong quarter of growth and solid operational performance, as we responded with speed and agility to scale production and meet accelerating customer demand," said James Xiao, CEO. "We are positioning UCT to capture more value from this next phase of AI-driven industry expansion by co-innovating with our customers, developing more advanced solutions, and executing with focus and discipline. Through UCT 3.0, we are building a more agile and efficient company that is well positioned to anticipate customer needs, accelerate innovation, and translate industry growth into lasting shareholder value."

Third Quarter 2026 GAAP Financial Results
Total revenue was $759.0 million. Products contributed $681.9 million and Services added $77.1 million. Total gross margin was 16.9%, operating margin was 7.1%, and net income was $39.1 million or $0.85 per diluted share. This compares to total revenue of $644.9 million, gross margin of 16.1%, operating margin of 4.6%, and net income of $8.7 million or $0.19 per diluted share, in the prior quarter.

Third Quarter 2026 Non-GAAP Financial Results
On a non-GAAP basis, gross margin was 17.3%, operating margin was 9.0%, and net income was $53.2 million or $1.15 per diluted share. This compares to gross margin of 16.7%, operating margin of 7.0%, and net income of $32.3 million or $0.70 per diluted share, in the prior quarter.

Fourth Quarter 2026 Outlook
The Company expects revenue in the range of $800 million to $860 million. The Company expects GAAP diluted net income per share to be between $1.02 and $1.26, and non-GAAP diluted net income per share to be between $1.11 and $1.35.

Conference Call
The call will take place at 1:45 p.m. PT and can be accessed by dialing 1-800-836-8184 or 1-646-357-8785. No passcode is required. A replay of the call will be available by dialing 1-888-660-6345 or 1-646-517-4150 and entering the confirmation code 33664#. The Webcast will be available on the Investor Relations section of the Company's website at http://uct.com/investors/events/.

About Ultra Clean Holdings, Inc. 
Ultra Clean Holdings, Inc. is a leading developer and supplier of critical subsystems, components, parts, and ultra-high purity cleaning and analytical services, primarily for the semiconductor industry. Under its Products division, UCT offers its customers an integrated outsourced solution for major subassemblies, improved design-to-delivery cycle times, design for manufacturability, prototyping, and high-precision manufacturing. Under its Services Division, UCT offers its customers tool chamber parts cleaning and coating, as well as micro-contamination analytical services. Ultra Clean is headquartered in Hayward, California. Additional information is available at www.uct.com.

Use of Non-GAAP Measures
In addition to providing results that are determined in accordance with Generally Accepted Accounting Principles in the United States of America ("GAAP"), management uses non-GAAP gross margin, non-GAAP operating margin and non-GAAP net income to evaluate the Company's operating and financial results. We believe the presentation of non-GAAP results is useful to investors for analyzing our core business and business trends and comparing performance to prior periods, along with enhancing investors' ability to view the Company's results from management's perspective. The presentation of this additional information should not be considered a substitute for results prepared in accordance with GAAP. Tables presenting reconciliations from GAAP results to non-GAAP results are included at the end of this press release.

The Company defines non-GAAP net income as net loss before amortization of intangible assets, stock-based compensation, restructuring charges, debt refinancing costs, legal-related costs, unrealized loss (gain) on foreign exchange, VAT settlement, and the tax effects of the foregoing adjustments.

A reconciliation of our guidance for non-GAAP net income per diluted share for the subsequent quarter is not available due to fluctuations in the geographic mix of our earnings from quarter to quarter, which impacts our tax rate and cannot be reasonably predicted or determined. As a result, such reconciliation is not available without unreasonable efforts and we are unable to determine the probable significance of the unavailable information.

Safe Harbor Statement 
The foregoing information contains, or may be deemed to contain, "forward-looking statements" (as defined in the US Private Securities Litigation Reform Act of 1995) which reflect our current views with respect to future events and financial performance. We use words such as "anticipates," "projection," "outlook," "forecast," "believes," "plan," "expect," "future," "intends," "may," "will," "estimates," "see," "predicts," "should" and similar expressions to identify these forward-looking statements. Forward looking statements included in this press release include our expectations about the semiconductor capital equipment market and outlook. All forward-looking statements address matters that involve risks and uncertainties. Accordingly, the Company's actual results may differ materially from the results predicted or implied by these forward-looking statements. These risks, uncertainties and other factors also include, among others, those identified in "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in our annual report on Form 10-K for the year ended December 26, 2025, as filed with the Securities and Exchange Commission. Ultra Clean Holdings, Inc. undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise unless required by law.

Contact:
Rhonda Bennetto
SVP Investor Relations
rbennetto@uct.com

 

ULTRA CLEAN HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in millions, except per share data)
	Three Months Ended				Nine Months Ended
	September 25, 2026		September 26, 2025		September 25, 2026		September 26, 2025
Revenues:
Products	$           681.9		$           445.0		$        1,720.3		$        1,356.9
Services	77.1		65.0		217.3		190.4
Total revenues	759.0		510.0		1,937.6		1,547.3
Cost of revenues:
Products	575.7		380.4		1,465.2		1,163.9
Services	54.9		47.4		155.9		137.8
Total cost of revenues	630.6		427.8		1,621.1		1,301.7
Gross profit	128.4		82.2		316.5		245.6
Operating expenses:
Research and development	8.8		7.8		26.1		23.2
Sales and marketing	15.9		15.1		47.8		45.5
General and administrative	50.0		48.7		148.1		144.1
Impairment of goodwill	—		—		—		151.1
Total operating expenses	74.7		71.6		222.0		363.9
Income (loss) from operations	53.7		10.6		94.5		(118.3)
Interest income	1.4		1.1		3.8		3.0
Interest expense	(1.5)		(9.9)		(9.8)		(29.9)
Other expense, net	(2.5)		(1.2)		(3.2)		(2.5)
Income (loss) before provision for income taxes	51.1		0.6		85.3		(147.7)
Provision for income taxes	10.3		8.7		47.5		23.3
Net income (loss)	40.8		(8.1)		37.8		(171.0)
Less: Net income attributable to noncontrolling interests	1.7		2.8		7.9		6.9
Net income (loss) attributable to UCT	$             39.1		$           (10.9)		$             29.9		$         (177.9)
Net income (loss) per share attributable to UCT common stockholders:
Basic	$             0.86		$           (0.24)		$             0.66		$           (3.93)
Diluted	$             0.85		$           (0.24)		$             0.65		$           (3.93)
Shares used in computing net income (loss) per share:
Basic	45.4		45.4		45.3		45.2
Diluted	46.2		45.4		46.2		45.2

 

ULTRA CLEAN HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; in millions)
	September 25, 2026		December 26, 2025
ASSETS
Current assets:
Cash and cash equivalents	$                       270,9		$                      311,8
Accounts receivable, net of allowance for credit losses	272,4		208,8
Inventories	723,3		390,9
Prepaid expenses and other current assets	67,6		48,2
Total current assets	1 334,2		959,7
Property, plant and equipment, net	344,4		324,6
Goodwill	114,2		114,2
Intangible assets, net	136,4		156,8
Deferred tax assets, net	4,1		3,5
Operating lease right-of-use assets	156,3		157,2
Other non-current assets	14,8		13,0
Total assets	$                    2 104,4		$                   1 729,0
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt	$                           —		$                          9,9
Accounts payable	335,2		194,9
Accrued compensation and related benefits	63,3		51,1
Operating lease liabilities	22,3		20,2
Other current liabilities	57,8		24,6
Total current liabilities	478,6		300,7
Long-term debt	635,1		467,0
Deferred tax liabilities	13,7		13,8
Operating lease liabilities	152,7		156,6
Other liabilities	11,0		6,8
Total liabilities	1 291,1		944,9
Equity:
UCT stockholders' equity:
Common stock	0,1		0,1
Additional paid-in capital	601,6		578,7
Common shares held in treasury	(88,7)		(48,4)
Retained earnings	219,1		189,2
Accumulated other comprehensive loss	(4,6)		(8,6)
Total UCT stockholders' equity	727,5		711,0
Noncontrolling interests	85,8		73,1
Total equity	813,3		784,1
Total liabilities and equity	$                    2 104,4		$                   1 729,0

 

ULTRA CLEAN HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in millions)
	Nine Months Ended
	September 25, 2026		September 26, 2025
(In millions)
Cash flows from operating activities:
Net income (loss)	$              37.8		$           (171.0)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	37.5		35.5
Amortization of intangible assets	20.4		21.2
Stock-based compensation	17.2		14.4
Amortization of debt issuance costs	2.5		2.1
Loss on extinguishment of debt	3.4		—
Loss on disposal of property, plant and equipment	1.2		0.7
Impairment of goodwill	—		151.1
Change in the fair value of financial instruments	—		(0.1)
Deferred income taxes	(0.6)		0.4
Changes in assets and liabilities:
Accounts receivable	(63.6)		41.6
Inventories	(332.4)		(1.2)
Prepaid expenses and other current assets	(16.0)		(6.3)
Other non-current assets	0.0		(1.0)
Accounts payable	131.1		(22.8)
Accrued compensation and related benefits	12.2		(0.6)
Income taxes payable	3.3		(12.1)
Operating lease right-of-use assets and operating lease liabilities	(0.9)		10.2
Other liabilities	30.2		(4.6)
Net cash provided by (used in) operating activities	(116.7)		57.5
Cash flows from investing activities:
Purchases of property, plant and equipment	(45.3)		(40.2)
Proceeds from sale of equipment	0.1		3.2
Net cash used in investing activities	(45.2)		(37.0)
Cash flows from financing activities:
Proceeds from the issuance of common stock under at-the-market offering, net of commissions and fees	34.0		—
At-the-market offering costs for the issuance of common stock	(0.1)		—
Proceeds from the issuance of convertible notes	600.0		—
Borrowings on revolving credit facility	50.0		—
Proceeds from bank borrowings	—		59.3
Extinguishment of bank borrowings	—		(59.3)
Proceeds from issuance of common stock	1.1		1.1
Payment of debt issuance costs	(17.4)		(0.6)
Repurchase of common stock	(40.0)		(3.4)
Payment for capped call transactions	(25.1)		—
Principal payments on bank borrowings	(481.5)		(18.2)
Employees' taxes paid upon vesting of restricted stock units	(4.3)		(1.1)
Payments of dividends to a joint venture shareholder	(0.1)		(0.1)
Net cash provided by (used in) financing activities	116.6		(22.3)
Effect of exchange rate changes on cash and cash equivalents	4.4		2.0
Net increase (decrease) in cash and cash equivalents	(40.9)		0.2
Cash and cash equivalents at beginning of period	311.8		313.9
Cash and cash equivalents at end of period	$             270.9		$             314.1

 

ULTRA CLEAN HOLDINGS, INC.
REPORTABLE SEGMENTS
GAAP TO NON-GAAP RECONCILIATION
(Unaudited; dollars in millions)
	GAAP				Non-GAAP
	Three Months Ended				Three Months Ended
	September 25, 2026				September 25, 2026
	Products	Services	Consolidated		Products	Services	Consolidated
Revenues	$           681.9	$             77.1	$           759.0		$            681.9	$              77.1	$            759.0
Gross profit	$           106.2	$             22.2	$           128.4		$            108.3	$              23.2	$            131.5
Gross margin	15.6 %	28.8 %	16.9 %		15.9 %	30.1 %	17.3 %
Income from operations	$             46.7	$              7.0	$             53.7		$              58.1	$              10.5	$              68.6
Operating margin	6.8 %	9.1 %	7.1 %		8.5 %	13.6 %	9.0 %
					Three Months Ended
					September 25, 2026
					Products	Services	Consolidated
Reconciliation of GAAP Gross profit to Non-GAAP Gross profit (in millions)
Reported gross profit on a GAAP basis					$            106.2	$              22.2	$            128.4
Amortization of intangible assets (1)					1.3	1.0	2.3
Stock-based compensation expense (2)					0.6	—	0.6
Restructuring charges (3)					0.2	—	0.2
Non-GAAP gross profit					$            108.3	$              23.2	$            131.5
Reconciliation of GAAP Gross margin to Non-GAAP Gross margin
Reported gross margin on a GAAP basis					15.6 %	28.8 %	16.9 %
Amortization of intangible assets (1)					0.2 %	1.3 %	0.3 %
Stock-based compensation expense (2)					0.1 %	— %	0.1 %
Restructuring charges (3)					0.0 %	— %	0.0 %
Non-GAAP gross margin					15.9 %	30.1 %	17.3 %
Reconciliation of GAAP Income from operations to Non-GAAP Income from operations (in millions)
Reported income from operations on a GAAP basis					$              46.7	$                7.0	$              53.7
Amortization of intangible assets (1)					3.9	2.9	6.8
Stock-based compensation expense (2)					6.3	0.6	6.9
Restructuring charges (3)					0.6	0.0	0.6
Legal-related costs (4)					0.6	—	0.6
Non-GAAP income from operations					$              58.1	$              10.5	$              68.6
Reconciliation of GAAP Operating margin to Non-GAAP Operating margin
Reported operating margin on a GAAP basis					6.8 %	9.1 %	7.1 %
Amortization of intangible assets (1)					0.6 %	3.8 %	0.8 %
Stock-based compensation expense (2)					0.9 %	0.7 %	0.9 %
Restructuring charges (3)					0.1 %	— %	0.1 %
Legal-related costs (4)					0.1 %	— %	0.1 %
Non-GAAP operating margin					8.5 %	13.6 %	9.0 %

1	Amortization of intangible assets related to the Company's business acquisitions
2	Represents compensation expense for stock granted to employees and directors
3	Represents costs associated with employee separation, severance, retention, and other expenses related to facility closures
4	Represents estimated costs related to certain legal proceedings and a cybersecurity incident

 

ULTRA CLEAN HOLDINGS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP ADJUSTED RESULTS
	Three Months Ended
	September 25, 2026		September 26, 2025		June 26, 2026
Reconciliation of GAAP Net Income (Loss) to Non-GAAP Net Income (in millions)
Reported net income (loss) attributable to UCT on a GAAP basis	$           39.1		$         (10.9)		$          8.7
Amortization of intangible assets (1)	6.8		6.9		6.8
Stock-based compensation expense (2)	6.9		4.6		8.1
Restructuring charges (3)	0.6		7.1		0.7
Debt refinancing costs expensed (4)	—		1.1		0.7
Legal-related costs (5)	0.6		0.2		—
Unrealized loss (gain) on foreign exchange (6)	2.6		(2.4)		(1.9)
VAT settlement (7)	—		(0.2)		—
Income tax effect of non-GAAP adjustments (8)	(3.5)		(4.0)		(2.9)
Income tax effect of valuation allowance (9)	0.1		8.6		12.1
Non-GAAP net income attributable to UCT	$           53.2		$           11.0		$        32.3
Reconciliation of GAAP Income from operations to Non-GAAP Income from operations (in millions)
Reported income from operations on a GAAP basis	$           53.7		$           10.6		$        29.5
Amortization of intangible assets (1)	6.8		6.9		6.8
Stock-based compensation expense (2)	6.9		4.6		8.1
Restructuring charges (3)	0.6		7.1		0.7
Legal-related costs (5)	0.6		0.2		—
VAT settlement (7)	—		(0.2)		—
Non-GAAP income from operations	$           68.6		$           29.2		$        45.1
Reconciliation of GAAP Operating margin to Non-GAAP Operating margin
Reported operating margin on a GAAP basis	7.1 %		2.1 %		4.6 %
Amortization of intangible assets (1)	0.8 %		1.3 %		1.0 %
Stock-based compensation expense (2)	0.9 %		0.9 %		1.3 %
Restructuring charges (3)	0.1 %		1.4 %		0.1 %
Legal-related costs (5)	0.1 %		0.0 %		— %
VAT settlement (7)	— %		0.0 %		— %
Non-GAAP operating margin	9.0 %		5.7 %		7.0 %
Reconciliation of GAAP Gross profit to Non-GAAP Gross profit (in millions)
Reported gross profit on a GAAP basis	$         128.4		$           82.2		$      103.7
Amortization of intangible assets (1)	2.3		2.3		2.3
Stock-based compensation expense (2)	0.6		0.5		1.5
Restructuring charges (3)	0.2		2.1		0.1
VAT settlement (7)	—		(0.2)		—
Non-GAAP gross profit	$         131.5		$           86.9		$      107.6
Reconciliation of GAAP Gross margin to Non-GAAP Gross margin
Reported gross margin on a GAAP basis	16.9 %		16.1 %		16.1 %
Amortization of intangible assets (1)	0.3 %		0.4 %		0.4 %
Stock-based compensation expense (2)	0.1 %		0.1 %		0.2 %
Restructuring charges (3)	0.0 %		0.4 %		0.0 %
VAT settlement (7)	— %		0.0 %		— %
Non-GAAP gross margin	17.3 %		17.0 %		16.7 %
Reconciliation of GAAP Other income (expense), net to Non-GAAP Other income (expense), net (in millions)
Reported Other income (expense), net on a GAAP basis	$           (2.5)		$           (1.2)		$          0.6
Debt refinancing costs expensed (4)	—		1.1		0.7
Unrealized loss (gain) on foreign exchange (6)	2.6		(2.4)		(1.9)
Non-GAAP Other income (expense), net	$            0.1		$           (2.5)		$         (0.6)
Reconciliation of GAAP Income (Loss) Per Diluted Share to Non-GAAP Earnings Per Diluted Share
Reported net income (loss) on a GAAP basis	$           0.85		$         (0.24)		$        0.19
Amortization of intangible assets (1)	0.15		0.15		0.15
Stock-based compensation expense (2)	0.15		0.10		0.18
Restructuring charges (3)	0.01		0.16		0.01
Debt refinancing costs expensed (4)	—		0.02		0.01
Legal-related costs (5)	0.01		0.00		—
Unrealized loss (gain) on foreign exchange (6)	0.06		(0.05)		(0.04)
VAT settlement (7)	—		0.00		—
Income tax effect of non-GAAP adjustments (8)	(0.08)		(0.09)		(0.06)
Income tax effect of valuation allowance (9)	0.00		0.19		0.26
Impact of dilutive shares	0.00		0.00		0.00
Non-GAAP net earnings	$           1.15		$           0.24		$        0.70
Weighted average number of diluted shares (in millions) on a non-GAAP basis (10)	46.2		45.6		46.0
ULTRA CLEAN HOLDINGS, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP EFFECTIVE INCOME TAX RATE
	Three Months Ended
	September 25, 2026		September 26, 2025		June 26, 2026
Provision for income taxes on a GAAP basis	$           10.3		$            8.7		$        18.1
Income tax effect of non-GAAP adjustments (8)	3.5		4.0		2.9
Income tax effect of valuation allowance (9)	(0.1)		(8.6)		(12.1)
Non-GAAP provision for income taxes	$           13.7		$            4.1		$          8.9
Income before income taxes on a GAAP basis	$           51.1		$            0.6		$        30.0
Amortization of intangible assets (1)	6.8		6.9		6.8
Stock-based compensation expense (2)	6.9		4.6		8.1
Restructuring charges (3)	0.6		7.1		0.7
Debt refinancing costs expensed (4)	—		1.1		0.7
Legal-related costs (5)	0.6		0.2		—
Unrealized loss (gain) on foreign exchange (6)	2.6		(2.4)		(1.9)
VAT settlement (7)	—		(0.2)		—
Non-GAAP income before income taxes	$           68.6		$           17.9		$        44.4
Effective income tax rate on a GAAP basis	20.2 %		1450.0 %		60.3 %
Non-GAAP effective income tax rate	20.0 %		22.9 %		20.0 %

1    Amortization of intangible assets related to the Company's business acquisitions

2    Represents compensation expense for stock granted to employees and directors

3    Represents costs associated with employee separation, severance, retention, and other expenses related to facility closures

4    Represents certain third party transaction costs related to the amended credit agreement and the previously capitalized costs of extinguished debt

5    Represents estimated costs related to certain legal proceedings and a cybersecurity incident

6    Represents unrealized foreign exchange gains and losses arising from the remeasurement of monetary assets and liabilities

7    Represents impact of value added tax ruling

8    Tax effect of items (1) through (7) above based on the non-GAAP tax rate

9    The Company's GAAP tax expense is generally higher than the Company's non-GAAP tax expense, primarily due to losses in the U.S. with full federal and state valuation allowances. The Company's non-GAAP tax rate and resulting non-GAAP tax expense considers the tax implications as if there was no federal or state valuation allowance position in effect

10  Non-GAAP diluted weighted-average common shares are adjusted to reflect the dilutive impact of our convertible note based on the capped call cap price instead of the initial conversion price

 

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SOURCE Ultra Clean Holdings, Inc.

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What were Ultra Clean Holdings' third-quarter 2026 earnings?

Ultra Clean Holdings reported GAAP net income attributable to UCT of $39.1 million, or $0.85 per diluted share. Non-GAAP net income was $53.2 million, or $1.15 per diluted share, compared with $32.3 million, or $0.70 per diluted share, in the prior quarter.

What is UCTT's fourth-quarter 2026 outlook?

Ultra Clean expects revenue of $800 million to $860 million, GAAP diluted earnings per share of $1.02 to $1.26, and non-GAAP diluted earnings per share of $1.11 to $1.35 for the fourth quarter of 2026.

How profitable were Ultra Clean's Products and Services segments in the third quarter of 2026?

Products reported GAAP operating income of $46.7 million and Services reported $7.0 million. Products had a GAAP operating margin of 6.8% and gross margin of 15.6%; Services had a GAAP operating margin of 9.1% and gross margin of 28.8%.