Onto Innovation Inc. (ONTO)

Price$268.01Cached quoteAs of 2026-09-06 18:57 UTC

AI: Overvalued

Price checkThe shares look expensive even after giving strong recent growth substantial credit.

At the observed market price, Onto’s stock market value is about $14.3 billion using roughly 49 million shares. That is about 109 times recent generally accepted accounting earnings and about 48 times fiscal 2025 free cash flow, meaning cash left after running and investing in the business. A simple valuation using a 10% required return and 3% long-term growth needs roughly 19% annual free-cash-flow growth for a decade to justify the price, before adding any margin of safety.

Big pictureRevenue is accelerating again, but profits and cash have moved sharply with the chip cycle.

The business is growing again, but history shows real swings. Revenue rose from $816 million in fiscal 2023 to $987 million in 2024 and $1.01 billion in 2025, while profit from operations moved from $116 million to $187 million and then down to $133 million. Second-quarter 2026 revenue jumped 35% from a year earlier to $343 million, and net income rose to $60 million. Yet first-half cash generated by operations fell to $88 million from $150 million as receivables and inventory absorbed cash.

Business strengthStrong products and customer demand support growth, but recent dealmaking has raised financial complexity.

Onto ended June with $1.88 billion of cash and investments that can readily be sold, but it also issued $1.5 billion of zero-interest convertible debt, which can eventually turn into shares, and then spent about $720 million for a 27% Rigaku stake. Option contracts reduce much of the conversion-related dilution across a broad price range. Onto also repurchased 805,000 shares for about $205 million; shares outstanding fell to 49.0 million from 49.7 million in March. Semilab added growth but lost $9 million operationally in the first half.

What could change the storySustained growth above guidance could justify more, while customer spending cuts would expose the valuation.

The bull case strengthens if quarterly revenue stays near or above $400 million, profit from operations remains above 20% of sales, and Semilab turns profitable. Backlog exceeded $1 billion, advanced-nodes revenue rose 50% sequentially, and third-quarter revenue guidance is $380 million to $400 million. The bear case is customer concentration and spending cyclicality: four customers represented about 57% of first-half revenue, while 85% of sales came from systems and software. A broad customer pullback could therefore hit both earnings and the rich valuation quickly.

AI: News

Record quarter and outlookRecord sales, a larger backlog, and stronger guidance raised expectations for the next several quarters.

On August 6, Onto reported record second-quarter revenue of $343 million, up 35% from a year earlier, with advanced-nodes revenue up 50% sequentially and backlog above $1 billion. It guided third-quarter revenue to $380 million to $400 million and generally accepted accounting earnings per share to $1.54 to $1.70. Shares rose about 15% the next session. The timing is consistent with a positive earnings response, though it does not prove the report was the only cause.

Rigaku investment closesOnto committed major capital to Rigaku, adding strategic upside but reducing the cash cushion.

On August 10, Onto completed the purchase of a 27% minority stake in Rigaku Holdings for about $720 million. The investment is meant to deepen cooperation on X-ray process-control tools for advanced semiconductor manufacturing, but Onto will not consolidate Rigaku’s results into its own sales and profit. The transaction therefore shifts a large amount of liquidity into a strategic financial asset whose value depends on Rigaku’s performance and on whether the partnership produces commercial benefits.

Convertible financingA large zero-interest financing funded expansion and buybacks while introducing future repayment and dilution risk.

In May, Onto issued $1.5 billion of convertible debt due 2031 carrying no regular interest. It used about $205 million to repurchase roughly 805,000 shares and paid for option contracts designed to reduce dilution if the debt converts into stock. The financing also helped fund the Rigaku investment. Investing.com reported the shares fell after the pricing. The structure is cheap funding today, but it adds a large future obligation and possible share issuance if the stock rises enough.

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Financial statements

	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015	2014	2013	2012	2011	2010	2009
Revenue	$1.01B	$987.3M	$815.9M	$1.01B	$788.9M	$556.5M	$305.9M	$273.8M	$255.1M	$221.1M	$187.4M	$166.4M	$144.3M	$182.9M	$230.1M	$188.1M	$76.7M
Gross profit	$499.8M	$515.3M	$420.3M	$539.2M	$429.1M	$278.5M	$135.0M	$148.3M	$134.6M	$114.1M	$89.7M	$75.8M	$62.7M	$83.9M	$122.1M	$101.4M	$36.1M
Gross margin	49.72%	52.19%	51.51%	53.64%	54.39%	50.04%	44.14%	54.16%	52.76%	51.61%	47.86%	45.55%	43.43%	45.89%	53.07%	53.91%	47.09%
Research & development	$132.0M	$113.9M	$104.4M	$112.0M	$96.1M	$84.6M	$48.4M	$40.0M	$37.7M	$31.4M	$32.7M	$33.8M	$32.7M	$29.6M	$23.3M	$19.0M	$14.7M
Operating expenses	$366.8M	$328.2M	$304.2M	$302.5M	$272.7M	$251.8M	$140.1M	$97.2M	$75.3M	$85.0M	$84.7M	$87.5M	$84.4M	$78.5M	$76.3M	$60.1M	$49.5M
Operating income	$132.9M	$187.1M	$116.1M	$236.7M	−$156.4M	−$26.7M	−$5.0M	$51.1M	$59.3M	$29.1M	$5.0M	−$11.7M	−$21.7M	$5.5M	$45.8M	$41.3M	−$13.4M
Operating margin	13.22%	18.95%	14.23%	23.55%	−19.83%	−4.79%	−1.65%	18.66%	23.24%	13.16%	2.65%	−7.00%	−15.04%	3.00%	19.89%	21.97%	−17.42%
EBITDA	$193.4M	$249.4M	$183.3M	$301.4M	−$90.6M	$40.9M	$11.4M	$57.9M	$66.2M	$37.4M	$14.0M	−$1.9M	−$12.9M	$13.6M	$50.7M	$45.7M	−$7.3M
EBITDA margin	19.24%	25.26%	22.47%	29.98%	−11.49%	7.35%	3.72%	21.16%	25.95%	16.91%	7.50%	−1.13%	−8.95%	7.44%	22.06%	24.31%	−9.47%
Net income	$136.8M	$201.7M	$121.2M	$223.3M	$142.3M	$31.0M	$223.3M	$45.1M	$32.9M	$44.0M	$2.9M	−$31.1M	−$14.1M	$4.5M	$28.7M	$55.9M	−$16.3M
Net profit margin	13.60%	20.43%	14.85%	22.22%	18.04%	5.58%	73.01%	16.47%	12.90%	19.91%	1.55%	−18.70%	−9.80%	2.44%	12.47%	29.75%	−21.26%
Basic EPSper basic share	$2.78	$4.09	$2.47	$4.52	$2.89	$0.63	$0.06	$1.77	$1.30	$1.79	$0.12	-$1.30	-$0.61	$0.19	$1.26	$2.56	-$0.87
Diluted EPSper diluted share	$2.78	$4.06	$2.46	$4.49	$2.86	$0.63	$0.06	$1.74	$1.27	$1.75	$0.12	-$1.30	-$0.61	$0.19	$1.22	$2.43	-$0.87

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

11.23%of listed shares

BlackRock, Inc.5.51M shares · Jun 30, 2026

View holders

Top 20 reported holders of ONTO
Holder	% owned
BlackRock, Inc.	11.23%5.51M shares
VANGUARD PORTFOLIO MANAGEMENT LLC	5.56%2.73M shares
VANGUARD CAPITAL MANAGEMENT LLC	4.58%2.25M shares
STATE STREET CORP	3.17%1.55M shares
GEODE CAPITAL MANAGEMENT, LLC	2.92%1.43M shares
Invesco Ltd.	2.76%1.35M shares
PARADIGM CAPITAL MANAGEMENT INC/NY	2.25%1.1M shares
Point72 Asset Management, L.P.	1.98%972.16K shares
FMR LLC	1.80%883.3K shares
PRICE T ROWE ASSOCIATES INC /MD/	1.74%853.31K shares
VOYA INVESTMENT MANAGEMENT LLC	1.54%753.77K shares
Pictet Asset Management Holding SA	1.46%716.22K shares
WILLIAM BLAIR INVESTMENT MANAGEMENT, LLC	1.36%665.38K shares
NORGES BANK	1.33%649.73K shares
TWO SIGMA INVESTMENTS, LP	1.29%632.98K shares
JENNISON ASSOCIATES LLC	1.21%594.17K shares
DIMENSIONAL FUND ADVISORS LP	1.20%589.36K shares
Thrivent Financial for Lutherans	1.20%586.72K shares
FRANKLIN RESOURCES INC	1.10%540.58K shares
WELLINGTON MANAGEMENT GROUP LLP	1.10%539.31K shares

Percentages use 49.03M shares of this listed class outstanding on Jun 30, 2026.

Gray completes the 100% scale. Reported positions may overlap; holders have different reporting dates.

Source: SEC Form 13F ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys0$0.00 disclosed value

Sells (SEC code S)9$18.66M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Feb 13, 2025Form 4 · 10b5-1	Vedula SrinivasSVP, Customer Success	SellCommon Stock	238	$169.58	$40.4K	15.5K
Jan 21, 2025Form 4 · 10b5-1	Plisinski Michael PCEO	SellCommon Stock	35.0K	$219.19	$7.67M	150.5K
Jan 16, 2025Form 4 · 10b5-1	Plisinski Michael PCEO	SellCommon Stock	100	$212.11	$21.2K	185.5K
Jan 16, 2025Form 4 · 10b5-1	Plisinski Michael PCEO	SellCommon Stock	29.9K	$211.24	$6.32M	185.6K
Jan 15, 2025Form 4 · 10b5-1	Vedula SrinivasSVP, Customer Success	SellCommon Stock	827	$205.00	$169.5K	15.2K

Review ownership filings at SEC.gov ↗

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Onto Innovation Inc. (ONTO)

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