Shares of Axcelis Technologies (ACLS -12.25%) sank in Tuesday's trading. The stock ended today's session down 12.3% and had been down as much as 14.6% earlier in the day.

The supplier to semiconductor makers reported its fourth-quarter results after the market closed on Monday and actually delivered sales and earnings that came in significantly ahead of the average Wall Street targets. But despite the fourth-quarter beats, the company issued forward guidance that disappointed investors.

Axcelis slumps despite beating Wall Street's quarterly targets

Axcelis reported earnings per share (EPS) of $1.54 on revenue of $252.42 million in the fourth quarter, beating the average analyst estimate's call for per-share earnings of $1.25 on revenue of $244.95 million. Sales for the period were down approximately 19% year over year but still managed to come in ahead of Wall Street's target.

Similarly, diluted EPS fell roughly 28% compared to the prior-year period but came in far better than the average analyst target. The results would have likely been enough to power significant gains for the stock, but management issued guidance for the first quarter that came in far below expectations and gave a cautious industry outlook.

What's next for Axcelis?

For the first quarter, management anticipates revenue of roughly $185 million, far short of the $221.6 million in sales previously called for by the average Wall Street target. In last year's first quarter, the business posted sales of $252.4 million. Meanwhile, earnings per diluted per share are projected to come in at $0.38, a dramatic decline from $1.57 a year ago.

Despite expectations that the silicon carbide market will continue to grow, Axcelis expects weaker demand as customers continue to work through their existing supplies. Overall revenue is projected to decline again this year due to this trend and softer demand in the Chinese market.

On the other hand, management does expect that sales will see moderate improvement in the second half of the year and forecasts that product categories including silicon carbide and memory recovery will drive strong results over the long term. With the stock now down roughly 53% over the last year, shares could be worth a close look for investors who aren't deterred by cyclical business pressures.