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DATE

Aug. 5, 2025, 1 p.m. ET

CALL PARTICIPANTS

Chief Executive Officer — Rafi Amit

Chief Financial Officer — Moshe Eisenberg

Chief Operating Officer — Rami Langer

Vice President of Investor Relations — Kenny Green

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RISKS

Operating Expenses— Operating expenses (non-GAAP) rose to $26.6 million in Q2 2025, up from $21.6 million a year ago and $24.4 million in the prior quarter, mainly due to "exceptionally high shipping expenses related to the conflict with Iran."

Moshe Eisenberg stated that unusual shipping expenses in Q2 2025 totaled "over half a million dollars," attributed to the recent geopolitical conflict.

TAKEAWAYS

Revenue-- $123.3 million in non-GAAP revenue for Q2 2025, representing over 20% year-over-year growth and a record quarterly result, with management guiding for $125 million in non-GAAP revenue for the next quarter.

Gross Margin-- 51.9% non-GAAP gross margin for Q2 2025, stable sequentially and improved from last year, underpinning the company's high profitability.

Operating Profit-- Operating profit (non-GAAP) was $37.4 million for Q2 2025, up from $30.8 million a year ago and essentially flat compared to $37.3 million in the prior quarter, despite higher expenses.

Operating Margin-- 30.3%, compared with 31.5% a year ago, showing a slight compression due to higher shipping costs. (non-GAAP, Q2 2025 vs Q2 2024)

Net Income-- $38.8 million, or $0.79 per diluted share, up from $32.6 million, or $0.66 per share, last year (non-GAAP).

Cash and Equivalents-- $544 million at quarter-end, up from $523 million at the end of the prior quarter, supported by over $23 million in cash generated from operations.

Geographic Revenue Mix-- Asia contributed 90% of sales, with the remaining 10% from the rest of the world.

Product Revenue Mix-- High-performance computing (HPC) applications represented 45%-50% of total company revenue, while other advanced packaging accounted for about 20% (non-GAAP).

New Product Contribution-- Hawk and Eagle 5 systems are expected to generate approximately 30% of company revenue (non-GAAP) in 2025, with an even greater contribution anticipated in 2026.

Orders and Pipeline-- Management cited a "healthy orders flow and pipeline into the fourth quarter."

Inventory-- Inventory rose to $149 million from $142 million, to support expected demand for Eagle Gen 5 and Hawk products.

China Revenue-- China made up approximately 30% of revenue in 2024 and is expected to be "a little bit higher" in 2025, though no additional quantitative figures were provided.

Impact of Shipping Cost Spike-- The quarter saw over $500,000 in added shipping costs due to the Iran conflict, but expenses have since returned to normal.

Advanced Packaging Technology Trends-- Growth is being driven by adoption of hybrid bonding, finer micro bump densities below 10 microns, and redistribution layers (RDL) with widths of two microns or less.

Customer Adoption-- Over 30 micro proof metrology systems (originating from the FRT acquisition) have been adopted by a tier-one customer and are operating in full-scale production.

SUMMARY

Camtek(CAMT -8.25%) delivered record non-GAAP results with strong year-over-year revenue and net income growth for Q2 2025, supported by the robust adoption of new product lines and a favorable demand environment. Management raised near-term guidance and attributed strength to continued demand in high-performance computing and advanced packaging, emphasizing that new installations of Hawk and Eagle 5 systems are expected to drive a larger portion of revenue in 2026. Despite a temporary spike in shipping costs resulting from geopolitical tensions, the company maintained strong cash flow, expanded inventory to prepare for upcoming sales, and indicated that shipping costs have since normalized.

Rami Langer described the hybrid bonding market as "a great opportunity for us" and stated Camtek's products are already running at strategic customers for early-stage production.

Hawk is now shipping in larger quantities, and the revenue mix from this platform is expected to rise further in 2026 as customer demand for advanced inspection capabilities accelerates.

Rami Langer said, "high-performance computing is going to be a main driver for our business" and highlighted 3D metrology and new software tools (EDI and ADC) as additional growth vectors.

Operating expenses were elevated by over $500,000 due to shipping disruptions, but Moshe Eisenberg confirmed normalization for Q3 "if the situation remains as is."

Rami Langer clarified that both Hawk and Eagle systems will address HBM4, with Hawk's higher price point and inspection capabilities bolstering future gross margin trajectory.

The order pipeline is described as healthy, with sequential revenue growth expected, but management deferred specific Q4 guidance due to ongoing market and customer visibility dynamics.

Camtek sees sustained growth in OSAT-related applications, with COAS and COAS-like production shifting further toward major OSAT customers.

INDUSTRY GLOSSARY

HPC (High-Performance Computing): Computing systems designed for heavy computational tasks, such as AI, data processing, and scientific simulations, driving specialized semiconductor demand.

OSAT (Outsourced Semiconductor Assembly and Test): Companies providing third-party semiconductor packaging and testing services, increasingly relevant for advanced packaging adoption.

Hybrid Bonding: An advanced semiconductor packaging process enabling fine-pitch connections for high-density integration, critical for next-generation memory and computational devices.

HBM (High Bandwidth Memory): A type of high-speed memory used in HPC and AI systems; the discussion includes current (HBM3/3E) and next-generation (HBM4) advancements.

COAS (Chip-On-Advanced-Substrate): A semiconductor packaging technique enabling heterogeneous integration of various chiplets on advanced substrates for increased performance.

RDL (Redistribution Layer): A metallization process allowing rerouting of connections on a chip, facilitating finer connectivity in advanced packaging solutions.

EDC (Enhanced Defect Detection): Proprietary software aimed at improving the accuracy and efficiency of identifying defects on semiconductor wafers or components.

ADC (Automatic Defect Classification): Automated software algorithms that categorize defects detected during inspection, supporting process optimization and yield improvement.

Full Conference Call Transcript

Rafi will open by providing an overview of Camtek's results and discuss recent market trends. Moshe will then summarize the financial results of the quarter. Following that, Rafi, Moshe, and Rami will be available to take your questions. Before we begin, I'd like to remind everyone that the statements made by management on this call will contain forward-looking statements within the meaning of the federal securities laws. Those statements are subject to a range of changes, risks, and uncertainties that may cause actual results to differ and vary materially.

For more information regarding the risk factors that may impact Camtek's results, please review Camtek's earnings release and SEC filings, specifically the forward-looking statements and risk factors identified in the results press release issued earlier today, and other risk factors as discussed in Camtek's most recent annual report on SEC form 20-F. Camtek does not undertake the obligation to update these forward-looking statements in light of new information or future events. Today's discussion of the financial results will be presented on a non-GAAP financial basis unless otherwise specified. As a reminder, a detailed reconciliation between GAAP and non-GAAP results can be found in today's earnings release. And now I'd like to hand the call over to Mr.

Rafi Amit, Camtek's CEO. Rafi, please go ahead.

Rafi Amit: Thanks, Kenny. Hello, everyone. Camtek concluded the second quarter with a record performance. Q2 revenues reached $123.3 million, reflecting over 20% growth year over year. We also maintained our gross margin at around 52%, contributing a record operating income of over $37 million. Revenue distribution remained in line with our expectations and closely matched last quarter's results. High-performance computing applications contributed approximately 45 to 50% of total revenue, while other advanced packaging applications accounted for about 20%. The balance came from CMOS image sensor, compound semiconductor, front-end applications, and other general applications. We continue to observe a shift in COAS-like production towards OSAT, a trend that plays to our advantages given Camtek's strong market position in this segment.

We continue to see strong momentum heading into the third quarter. Based on the current orders, our sales pipeline, and ongoing customer engagement, we expect Q3 2025 revenue to be approximately $125 million, representing an annualized run rate of half a billion dollars, a significant milestone for the company. In addition, we have a healthy orders flow and pipeline into the fourth quarter. The advanced packaging segment is rapidly evolving with technological changes to support the fast-paced evolution of high-performance computers for AI applications. Based on analyst research on the semiconductor industry, the advanced packaging market that supports AI-related applications is expected to grow at an exceptionally rapid rate over the next few years.

This growth is being driven by the adoption of new packaging technologies such as hybrid bonding, micro copper bumps with densities below 10 microns, RDL with line width of two microns and below, and more. This advancement requires state-of-the-art inspection and metrology capabilities combined with AI-based algorithms to detect defects, filter out noncritical issues, and classify defects, hence ensuring that only high-quality components enter the HPC module assembly line. By integrating advanced inspection and metrology tools, manufacturers can significantly increase yield and gain valuable insight into defect types, empowering continuous process refinement and production optimization. Camtek anticipated the upcoming technological shift several years in advance and made significant strategic investments to develop innovative solutions addressing these emerging opportunities.

We have invested heavily in developing cutting-edge platforms that combine exceptional mechanical precision with state-of-the-art optical technologies. These efforts have culminated in the launch of the Hawk and Eagle 5 systems, delivering breakthrough performance and significantly higher throughput compared to our existing systems. In parallel, we have been developing software solutions such as enhanced defect detection (EDC) and automatic defect classification (ADC) technologies that will strengthen our competitive edge in the market. The Hawk and the Eagle 5 have been exceptionally well received by our customers and are expected to generate approximately 30% of total revenue this year, with an even larger contribution projected for the next year.

In addition, our micro proof metrology system, originated from the FRT acquisition, has been successfully adopted and accepted by a tier-one customer for multiple metrology applications. Over 30 systems have already been installed and are now operating seamlessly in full-scale production environments. In summary, Camtek has solidified its position as a market leader in its domain. We believe the packaging technologies highlighted today represent significant growth opportunities for us in the coming year. And now Moshe will review the financial results. Moshe, thanks, Rafi. Revenue for the second quarter came in

Moshe Eisenberg: a record $123.3 million, an increase of 20% compared with 2024. The geographic revenue split for the quarter was similar to last quarter, as follows: Asia, 90%, and the rest of the world accounted for 10%. Gross profit for the quarter was $64 million. The gross margin for the quarter was 51.9%, similar to the previous quarter and an improvement from the second quarter of last year. Operating expenses in the quarter were $26.6 million compared to $21.6 million in the second quarter of last year, and $24.4 million in the previous quarter.

Operating profit in the quarter was $37.4 million compared to the $30.8 million reported in the second quarter of last year, and $37.3 million in the first quarter. These record results were achieved despite an increase in the operating expenses, which were mainly due to the exceptionally high shipping expenses related to the conflict with Iran. Operating margin was 30.3%, compared to 31.5% respectively. Financial income for the quarter was $4.9 million, similar to the $5 million reported last year and a decrease from the $5.4 million in the previous quarter. The decrease from the previous quarter was mainly an impact of the weakness of the US dollar on reevaluation of certain balance sheet items.

Net income for 2025 was $38.8 million or 79¢ per diluted share. This is compared to a net income of $32.6 million or 66¢ per share in the second quarter of last year. Total diluted number of shares as of the end of the second quarter was 49.3 million. Turning now to some high-level sheet and cash flow metrics. Cash, cash equivalents, including short and long-term deposits and marketable securities as of June 30, 2025, were $544 million. This compared with $523 million at the end of the first quarter. We generated over $23 million in cash from operations in the quarter.

Accounts receivable increased to $112 million from $100 million in the previous quarter, mainly due to timing of collection. Inventory level increased to $149 million from $142 million. The increase over the quarter is primarily to support the anticipated sales growth of our new Eagle Gen 5 and Hawk product in the coming quarters. As Rafi said before, we expect revenues of around $125 million in the third quarter. And with that, Rafi, Rami, and I will be open to take your questions. Kenny?

Kenny Green: Thank you, Moshe. At this time, we'll begin the question and answer session. If you have a question, please raise your hand via the Zoom platform. I will introduce you and ask you to unmute, after which you may ask your question. So we'll give a few moments for everyone to put themselves in the queue. Our first question will be from Charles Shi from Needham. Charles, you may go ahead and ask your question.

Charles Shi: Thanks for taking my question. Maybe the first question, I want to get a little bit of updated thoughts about the composition of the business, maybe for the second half of the year or maybe for the full year, whichever time frame you guys prefer to discuss. So I want to ask, HPC, what's the for the second half of the year maybe from a mix perspective? Clearly, first half, it has been around that 45-50% level. Is it a similar level into the second half? Or for the full year? And on a related question, I do want to ask what's the current expectation for China contribution to the total revenue for the year?

Last time, I think you guys were more looking at the 35 to 40% of total revenue. Have any of those numbers changed? Thank you.

Moshe Eisenberg: So thank you, Charles. So let's talk a little bit. We'll start with your first question. We see a positive momentum

Rami Langer: in the second half. And as we discussed in Rafi's discussion, we have a healthy order flow and pipeline. We provided a positive guidance for Q3 and we'll provide the guidance for Q4 in the next earnings call. Regarding the HPC, we expect the HPC revenues in the second half to be not much different than the first half. And regarding China,

Moshe Eisenberg: Charles, hi. Regarding the China contribution to the business, altogether, China is obviously significant to Camtek, has been so for many years. Last year, the contribution was around 30%. We expect that this year, the contribution will be a little bit higher than that. It's still early to say how much will be the contribution for the second half, but we expect it to be a little bit higher.

Charles Shi: Thanks. Okay. Specific around China, no additional quantitative view for the year. Maybe a second question a little bit more. At a higher level, and maybe this is more about product and technology. KLA has been making a good amount of inroads in 2.5D. It's at the leading foundry and looks like they are looking at the HBM opportunity as well. But so far, it looks like it's more around hybrid bonding related to HBM opportunity, maybe a little bit concentrated at one customer that is focusing on hybrid bonding. I want to get your general thoughts. Camtek's position versus potential entry of KLA in your existing HPC markets and what management thought on how to compete effectively versus KLA.

And yeah, let's go from there.

Rami Langer: So let me start with the hybrid bonding. We see the hybrid bonding as a great opportunity for us. This field is still in the early stages and we are running our tools today at strategic customers and we believe that we have the necessary capabilities in inspection and metrology to address the hybrid bonding opportunity. Now, you know, we discussed the KLA penetration and trying to get in some of the into this market. I think we discussed it also in the last call. And we've already been engaged in competition with KLA on multiple occasions at different customers, I would say, for the last couple of years. And we demonstrated that our equipment is highly competitive.

I think we are very well positioned to meet the specific requirements of this unique market. And with our latest products, the Hawk and the Eagle 5, even more than in the past, we offer a very competitive market. Now in general, the advanced packaging is our market. We are well known. We have excellent relationships with our customers, and we understand exactly their requirements moving into the future. Therefore, I think if I would like to summarize, I think the unique combination of our technology, scale, which is important here, and flexibility are key reasons why many customers choose to work with us over larger competitors who often are slower to respond.

Charles Shi: Thank you. That's all for me.

Rami Langer: Thank you. Thank you. Thanks, Charles.

Kenny Green: Our next question is from Matt Frisco of Cantor. Matt? You may go ahead and ask.

Matt Prisco: Hey, guys. Thanks for taking the question. So I guess, first, for your product ramps, can you go over where you're seeing the greatest traction today for both the Eagle G5 and the Hawk in terms of applications? And kind of what are the primary drivers behind the strong customer reception here?

Moshe Eisenberg: So

Rami Langer: I think it's a few things to drive the new products. So let me start with the Hawk. I think the Hawk provides two very important capabilities that are, first of all, very high throughput that is very important, where people are very sensitive to the footprint in the fabs. And on the other side, it provides the path to very, very, I would say, difficult applications that people will need now or into the future.

And I think people that are looking into this changing market that the products are changing, and people are not sure what they will need in a year or two, the Hawk provides a path to address those challenges with the capabilities it has today. And this obviously relates to the microbumps, you know, with the pitches coming very small, very high number of bumps, hybrid bonding, a lot of challenges in the inspection market. All of these challenges the Hawk provides a very, very good solution moving forward. On the G5, I think compared to the Eagle, it's much faster and I think it addresses it again from the optics point of view.

The ability to detect, I would say, defects that we couldn't previously address with the current products and other capabilities. So for the, I would say, for the price tag of a million plus, no doubt today the Eagle provides the best in class solution into the market. So I would say it's two different reasons. It's two different product lines. And I think what I've discussed, these are the reasons for the very high traction by our customers. And I think as we said in our prepared notes, we were able to achieve 30% of our revenues this year with two product lines, which is exceptionally well. And I expect that we will see more next year.

Maybe a few words about the applications. So as I said, and I will say it may be not clear enough. I just want to make sure that it's well understood. So first of all, the applications are, I would say, large number of bumps. That's very important. Very small defects. The Hawk will address defects down to 150 nanometers. And this is very challenging. And this is very important for hybrid bonding and other 2D inspection requirements. And, of course, the throughput and similarly the Eagle G5 on a different, I would say, not to the extent of the capabilities of the Hawk, but definitely a very good solution in the price range that is being offered.

If I answered your question,

Matt Prisco: Perfectly. Thank you. And then as a follow-up, given the success you're seeing in these new product ramps and your continued success into next year, can you maybe offer some early thoughts based on your visibility and customer conversations on how you're thinking about Camtek's growth prospects overall for the company into 2026? Thank you.

Rami Langer: 2025, 2026. So, look, regarding 2026, I think our market and specifically the high-performance computing are expected to grow rapidly in the coming years. This market also technologically changes and the HPC is undergoing a lot of changes. That we believe will create a lot of opportunities for us. For example, and I think Rafi mentioned it in his prepared notes, fine pitch micro bumps, hybrid bonding, HBM4, and many others. So if I look at these opportunities, at our market position, assuming a positive market environment in 2026, will no doubt support another growth year for Camtek.

Matt Prisco: Thank you, guys.

Kenny Green: Thanks, Matt. Our next question will be from Ezra Weiner of Jefferies. Ezra, please go ahead and ask your question.

Ezra Weiner: Hi. Yeah. Thanks for taking my question. I guess it's a two-parter. First, can you talk a little bit about the content uplift from HBM3/3E to HBM4 for you guys? I know there's a couple different paths people are going with it. So what you're seeing there, then the second part of that question would be from a CapEx perspective, what you're seeing at your customers. And what you're seeing for HBM specifically as we wait for potential qualification. Thank you.

Rami Langer: So obviously, the HBM market from a capacity point of view continues to grow. And we're seeing customers adding capacity. Now in general, the uplift and the, you know, it goes in a few ways. First of all, there are more HBMs per product. We see the density is growing, not drastically. I think the major jump in density from the HBM will come probably late 2026, early 2027. But definitely on the four, it's moving to more layers. And eventually, this means that we will scan more wafers. There is some change in the number of bumps, some pitch differences, but all in all, we've already been qualified at some customers for the HBM4.

So all in all, it's a very positive path. We're getting very good, I would say, inputs from our customers, so expect that definitely HBM4 will be a positive opportunity for us.

Ezra Weiner: Got it. Then if you could just talk a little bit about what you're seeing in terms of timing for customer spending and kind of the shape of that spend? In terms of HBM4 specifically?

Rami Langer: In HBM4 specifically, I would say that customers are talking to us, HBM4, we are starting to see emission forecasts to support the uplift of the HBM4. I think more than that, I will not be able to discuss during this call.

Ezra Weiner: Understood. Thank you very much.

Kenny Green: Thanks, Ezra. Our next question will be from Craig Ellis of B Riley. Craig, you may go ahead and ask your question.

Craig Ellis: Yeah. Thanks for taking the question. I wanted to follow-up a little bit on HBM4 to start. So it sounds like it's a very immaterial part of revenues today, and the visibility may not be clear on when you'd get the crossover from HBM3 to HBM4 related revenues. But if you have some idea of that sounding like 2026, it would be helpful. The question is more of this. When you look at the specific feature enhancements in either G5 or Hawk, what are they that are very advantageous for HBM4? And what does that mean for the trajectory of gross margin as we move through the HBM4 ramp-up period?

Rami Langer: Okay. So thank you, Craig, for the question. Now first of all, the equipment that we sold or most of the equipment that we sold to HBM3 will be used for HBM4 as well. So it's not that the, you know, what we sold in '25 or '24. This is immaterial. For the additional growths of this, some of this equipment has already been qualified to address the HBM4. So specific this is in general. However, there is an uplift. There is going to be an increase in capacity for the HBM4, and what I indicated in my previous answer is that we are already in the process of talking to customers about the forecast for HBM4.

Definitely, this will start to happen early in '26, wherein this, we will ship equipment to support the HBM4. More than that, I will not be able to give you any details. Now going to the Hawk versus the Eagle. The advantage of the Hawk, as I discussed in one of the previous questions, are two things. First of all, it's the throughput which means immediately much better footprint in the fab. It's the ability to address a large number of bumps in the HBM is going into this direction. Its inspection capabilities today already down to 150 nanometers. Already, we're demonstrating it at customers. This capability will be able to support also the HBM. The hybrid bonding requirements.

So definitely, all in all, when a customer is looking today whether he wants, you know, an Eagle versus he wants a Hawk, those that are thinking about the future and want to ensure that they will be able to support their products in two or three years, some of them lean towards making a higher investment today and buying the Hawk. From gross margin, in general, the Hawk is more expensive and it will have a positive contribution to our gross margins. Did I answer your question, Craig?

Craig Ellis: Yes. It does, Rami. Thank you very much. And the next question is somewhat intermediate to long-term question. And I'll start with congratulating the team on being just inches from driving the business to its $500 million run rate target. So good for you for getting so close to that target. But the question is this, if we look at the list of incremental growth drivers, we spend a lot of time on HBM4 and it sounds like that would be at the top of the list. But as we think about growth through 2026, what are the next couple of applications that we should be focused on as your bigger incremental growth drivers over the next eighteen months?

Thank you, team.

Rami Langer: So I think first of all, no doubt the high-performance computing is going to be a main driver for our business. This goes to metrology in general, 3D metrology. It's also in the metrology. And Rafi, in his prepared remarks, talked about the phenomenal success we have seen at the tier-one customer with our metrology line, and that's a line that's also going to contribute. I think it's a very good growth engine metrology in general for our business. And so I would say that the high-performance computing and getting into more and more applications, we're gaining more and more traction on the inspection part and definitely that's a big market with our capabilities on the G5.

And on the Hawk specifically, the ability to go and detect very small defects in the range of 150 nanometers. We'll definitely try a lot more applications outside also the high-performance computing. I think we are going to gain some traction with our new software capabilities, which we discussed in the prepared remarks. The EDC and the ADC, I won't go into all of the details. Definitely, these are technologies that are going to push us much, I would say, going to give us a lot of strength on the inspection side. But all in all, no doubt.

We are in a market that's going to grow at the run rate with what I hear from all the different analysts over 25% growth in the next few years. So definitely, I think this is the main driver. Of course, our task is to gain more and more applications in this market. Now we haven't forgotten the other markets. The conventional advanced packaging fan-out and other applications still have a very nice momentum. And last but not least, today, I think still we see a lot of opportunities in the front end. Compound semi is comparatively depressed in the last couple of years, but definitely this is an opportunity looking into the future.

And don't forget, we have I think about 350 customers, 200 active every year, a lot of ones and twos, that all of them will definitely provide additional opportunities in the foreseeable future.

Craig Ellis: Thank you, Rami.

Kenny Green: Thanks, Craig. Our next question is going to be from Gus Richard of Northland. Gus, please go ahead.

Gus Richard: Yes. Thanks for taking the question. Just in terms of the OSATs, can you talk a little bit about what you're seeing in terms of applications, how that compares to the traditional foundries that do advanced packaging for HPC?

Rami Langer: Hi, Gus. It's a very interesting process that we are seeing because I think we started to talk about it a year ago. That we expected the OSATs to start to take a position in the high-performance computing and this is definitely what we are seeing. They used to do, they started to go into the heterogeneous integration a couple of years ago. Started with these applications. We are seeing major OSATs today, some of the just do the COAS, and I think that the TSMC made some remarks about it. About specific names, but definitely we're seeing all the major OSATs. It's becoming a significant business.

And then we're definitely, you know, it's a significant number of orders that we are seeing for these applications from the major OSATs.

Gus Richard: Oh, yes. Yeah, can you hear me?

Rami Langer: We can hear you. Did you hear my answer?

Gus Richard: No. But I can follow-up later. A lot of people like this.

Rami Langer: Alright. So we'll have a follow-up later. Thank you, Gus.

Gus Richard: Yeah. Follow-up is how Well, look. The chiplets, we look at the chiplets in general as part of the high-performance computing, you know, eventually, it's a chiplet, which is either the GPU or CPU depends on the actual, I would say, design. Of the high-performance computer. And with it, you know, it's surrounded by the high bandwidth memories. So from that point of view, when we talk about a, we specifically talk about chiplets, the I'm chiplets. This market is picking up as part of all the changes in the market and I think from all the numbers that I'm seeing, it will continue to grow very.

Gus Richard: Got it. Thanks.

Rami Langer: Thanks, Gus.

Kenny Green: Our next question is from Tom O'Malley of Barclays. Tom, you may go ahead and ask your question.

Tom O'Malley: Hey, guys. Thanks for taking my question, and apologies if this got asked already. I just hopped on from another one. But I think you guys gave advanced packaging is about 20% of the revenue mix in the quarter. Can you talk about how much of that is HBM today versus a year ago? Has the percentage within advanced packaging grown pretty materially? And maybe give us an update of how much of that is HBM today.

Rami Langer: Okay. So let me, Tom, let me get the numbers correct. So 70% of our business goes to what we call advanced packaging. High-performance computing or HPC, whatever name you go, is part of our advanced packaging. So out of this 70%, 50% goes to HPC, and 20% goes to what we call conventional advanced packaging, such as fan-out. In the HPC, and because of the we do not specify what goes to chiplets and what goes to the high bandwidth memory, and the reason for it that there are changes, and it depends when the orders are coming. And it's too complicated. And therefore, we've been just talking about high-performance computing.

And for the last few quarters, we've been at a run rate where 50% of our total revenues went to high-performance computing, which includes HBM and chiplets.

Tom O'Malley: Gotcha. Thank you for that. I wanted to ask a little bit of a strange one. So bear with me. In a world right now where you have two major memory suppliers that are qualified on HBM for the largest guy in the world, and there's a third that's attempting to do that pretty aggressively. Which world suits you the best into next year? A world in which it is still two guys that are qualified that need to add more capacity or a world in which there are three qualified guys all who are serving the market. If you could walk through that, that'd be super helpful. Thank you.

Rami Langer: So you know, we don't have any preference. Whether it will be two, or three, all of the players today are very good customers to us. And if one of them that is not qualified will be qualified, we will enjoy it with additional application and steps, and we're working very closely with all of them. So we're fine with two, and we will be very fine also with three. Tom?

Kenny Green: Tom, you're on mute.

Tom O'Malley: I'm all good with those too. Thank you, guys.

Charles Shi: Thanks, Tom.

Kenny Green: Our next question will be from Edward Yang of Oppenheimer. Ed, you may go ahead and ask.

Edward Yang: Hi. Thanks for the time. Moshe mentioned high

Brian Chin: shipping costs that may have elevated your OpEx. Is that moderated now?

Moshe Eisenberg: Yes. This has been kind of an exceptionally high level of shipping expenses due to the conflict with Iran. Now that the conflict is muted, to some degree, the shipping expenses went back to normal rates. And we don't expect anything like that in the third quarter if the situation remains as is.

Brian Chin: And can you quantify what the impact was in the second quarter?

Moshe Eisenberg: It was over half a million dollars. Yes.

Brian Chin: Got it. And just to clarify on the positive momentum that Rami was talking about and you're seeing in the second half of the year. Are there any seasonal puts and takes that could impact the fourth quarter? Should we also expect that to grow revenue sequentially? And for the 2026 expected growth, you know, the street is modeling about 7% total revenue growth, but that's slower than what's typical for you. So maybe you could help us reconcile, you know, any divergence there or any reason why we shouldn't see another year of double-digit growth for Camtek in 2026? Thank you.

Rami Langer: So you know, it's too early definitely to talk about Q4, and we will discuss it in the next earnings call. But as I said before, on orders that are in the pipeline, and as we said, we didn't provide a guidance for Q3 that is positive. And therefore, I think the overall second half is definitely, as we said, we are, it's a positive momentum. Now I'm going back to '26, and you know, there are lots of discussions today about how '26 will look like. But, again, I think, really, this is much too early to discuss it. And this is a very dynamic market. Things are changing so fast here. This is true with the technology.

This is also true with everything that we do. But it is growing rapidly and would continue to grow in the foreseeable future. And with the technical changes and everything that is happening in the market, assuming a positive environment in 2026, definitely will lead to another growth year for Camtek. What will be the percentage? It's really too early. Unfortunately, it is too early today. But we'll talk about it in future calls.

Brian Chin: Fair enough. Thank you very much.

Kenny Green: Our next question will be from Dennis Piakchinin of Stifel. Dennis, please go ahead and ask your question.

Dennis Piakchinin: Hi. Thank you. This is Dennis on for Brian at Stifel. So for my first question, of Hawk versus Eagle shipments? Would you expect it to be roughly even, or do you think for HBM4 that customers would require more of the newer system?

Rami Langer: So first of all, this is very customer dependent. And we don't really give these numbers of Eagle versus the Hawk per applications. As I said, the Hawk has specific advantages in terms of capabilities in throughput, accuracy, and other aspects. Therefore, certain applications, and specifically for those that want very high volumes in the HBM4, may take some of the capacity will move into Hawks. But then again, this is very customer specific. And as we said, both products are very successful in the market. And definitely there is, and don't forget, it's not just HBM.

A lot of the business goes to the conventional advanced packaging, and there are many other applications where the Eagle Line, I think, is the best product for the price it is offered today in the marketplace. But then again, we'll probably, as time goes by, we'll be able to give you a much more, I would say, clearer estimations and discuss this a little bit more accurately. But that's more or less what we see today.

Dennis Piakchinin: Very Thank you.

Brian Chin: Yeah. Yeah.

Dennis Piakchinin: And then for my follow-up, maybe you can tell us a little bit more about the OSATs. So do the OSATs continue to exhibit more signs of strengthening? And maybe you can tell us, you know, what's driving this. Is it just found your OSAT logic expansion plans for the second half of 2025 and into 2026?

Rami Langer: We discussed the OSATs. And don't forget a lot of these players are still planning '26 and are still not in a position to release orders to give us the actual forecast. But I think for OSATs today, where we see a lot of the growth is coming first of all from the HPC as we discussed before. The major OSATs are starting to produce the COAS and COAS-like applications, and this is definitely a very high growth area. And I think this trend started a year ago, we see undergoing today and will continue into the foreseeable future. But don't forget there is a lot of regular advanced packaging, some fan-out and other applications.

We see a lot of this business still strong in the OSATs. Equipment to address those applications as we speak in each of the quarters that some of the applications that OSATs are buying equipment from us. So I would say from the OSATs, the major, I would say, two applications are the ones I discussed.

Dennis Piakchinin: Wonderful. That's it for me. Thank you.

Rami Langer: Thank you, Dennis. Thanks, Dennis.

Kenny Green: Our next question will be from Vivek Arya from Bank of America. Vivek, please go ahead.

Michael Mani: Hi. This is Michael Mani on for Vivek Arya. Thanks so much for taking our questions. To start, just want to ask about one of your major chiplet customers, which is, you know, covering some challenges currently. They recently revised their outlook for their CapEx in 2026 pretty meaningfully. So the question is, have you seen any major changes to, you know, the investment plans at any or chiplet customers? And to what extent, you know, could this already be reflected in your backlog? And, you know, could we see this demand be made up by some of your other customers over time as well?

Moshe Eisenberg: Well, the forecast may move by quarter here and there. And this happens, you know, on a regular basis that people move around, you know, their forecasts. In the focus to our shipments, so can't comment on anything.

Michael Mani: Understood. Thank you. And just on your newer products, you said that 30% of sales this year would come from Hawk and G5. So could you give us an idea of how much of that is weighted in the second half? And then I guess my main question, kind of the spirit of, like, of other questions that people have asked earlier in the call, I mean, how much incremental growth are these new tools driving for you? Would you say that they're mainly replacing for now, mainly replacing demand that you would normally see for your older systems?

And is it possible that we won't see the incremental growth from new applications, new customers really until we get to something close to HBM4? Just how would you frame incremental growth opportunity over the near term from these new tools?

Rami Langer: than the Hawk. So we started to ship it in larger quantities already at the beginning of the year. Actually, if I recall correctly, the first shipments were done in '24, and then we gradually increased it. So it was really loaded very nicely already in the first half. And we continue to see the growth into the second half as well. The Hawk, the shipments actually started a little later and it's more, I would say, the load well, maybe I would say we started more in the second quarter, and then we'll most of the shipments will be divided on three quarters. And we will see more shipments and the percentage will definitely be higher in 2026.

Now going into applications, definitely we are seeing more applications, but I will put it in a different way. I think that our product lines today are more competitive than the Eagle, and it's definitely more competitive today compared with our competition. So I think definitely this will mean for us potentially to take market share as we move into the future, say, more performance, and it's always throughput, and it's always better detection. So this is in general. When we talk about the Hawk, definitely, these are capabilities that we didn't have before. So definitely, this will open a lot of opportunities for us as we move along. But still, it's too early to quantify it.

Michael Mani: Great. Thanks so much.

Rami Langer: You're welcome.

Kenny Green: Thanks, Vivek. That will end our question and answer session. Before I hand back to Rafi for his closing statements, I'd like to mention that in the coming hours, this call will be available in the Investor Relations section of Camtek's website at camtek.com. And with that, I'd like to thank all of you for joining this call. Rafi, please go ahead and make your closing statements.

Rafi Amit: Okay. I was on mute. Sorry. I would like to sincerely thank all of you for your continued interest in Camtek. A special note of appreciation goes to our dedicated employees and exceptional management team for the outstanding performance and commitment. To our investors, I am truly grateful for your trust and long-term support. I look forward to updating you on our continued progress in the next quarter. Thank you.