Assets

6 Months Ended

Jun. 30, 2024

Assets

Assets

Note 4 — Assets

Investments

Short-term investments are generally classified as available-for-sale and reported at fair value, with unrealized gains and losses, net of tax, presented as a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income” in the Consolidated Balance Sheets. These securities may include U.S. treasuries, government agency securities, corporate debt, and commercial paper, all with maturities of greater than three months when purchased. All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary are included in “Other operating expense (income), net” in the Consolidated Statements of Operations.

Fair value is the price that would be received for an asset or the amount paid to transfer a liability in an orderly transaction between market participants. Veeco classifies certain assets based on the following fair value hierarchy:

Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2: Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and

Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Veeco has evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. The use of different market assumptions or estimation methodologies could have a significant effect on the estimated fair value amounts.

The following table presents the portion of Veeco’s assets that were measured at fair value on a recurring basis at June 30, 2024 and December 31, 2023:

	Level 1		Level 2		Level 3		Total
	(in thousands)
June 30, 2024
Cash equivalents
Certificate of deposits and time deposits	$	80,127	$	—	$	—	$	80,127
U.S. treasuries		19,971		—		—		19,971
Money market cash		18,148		—		—		18,148
Total	$	118,246	$	—	$	—	$	118,246
Short-term investments
U.S. treasuries	$	58,438	$	—	$	—	$	58,438
Government agency securities		—		18,068		—		18,068
Corporate debt		—		54,190		—		54,190
Total	$	58,438	$	72,258	$	—	$	130,696
December 31, 2023
Cash equivalents
Certificate of deposits and time deposits	$	74,262	$	—	$	—	$	74,262
Corporate debt		—		1,988		—		1,988
Money market cash		21,587		—		—		21,587
Total	$	95,849	$	1,988	$	—	$	97,837
Short-term investments
U.S. treasuries	$	59,493	$	—	$	—	$	59,493
Government agency securities		—		41,818		—		41,818
Corporate debt		—		35,409		—		35,409
Commercial paper		—		9,944		—		9,944
Total	$	59,493	$	87,171	$	—	$	146,664

There were no transfers between fair value measurement levels during the three and six months ended June 30, 2024.

At June 30, 2024 and December 31, 2023, the amortized cost and fair value of available-for-sale securities consist of:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
	(in thousands)
June 30, 2024
U.S. treasuries	$	58,541	$	—	$	(103)	$	58,438
Government agency securities		18,095		—		(27)		18,068
Corporate debt		54,307		—		(117)		54,190
Total	$	130,943	$	—	$	(247)	$	130,696
December 31, 2023
U.S. treasuries	$	59,541	$	3	$	(51)	$	59,493
Government agency securities		41,843		6		(31)		41,818
Corporate debt		35,447		9		(47)		35,409
Commercial paper		9,944		—		—		9,944
Total	$	146,775	$	18	$	(129)	$	146,664

Available-for-sale securities in a loss position at June 30, 2024 and December 31, 2023 consist of:

	Continuous Loss Position				Continuous Loss Position
	for Less than 12 Months				for 12 Months or More
			Gross				Gross
	Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses
		(in thousands)
June 30, 2024
U.S. treasuries	$	58,438	$	(103)	$	—	$	—
Government agency securities		11,345		(23)		6,723		(4)
Corporate debt		53,604		(117)		—		—
Total	$	123,387	$	(243)	$	6,723	$	(4)
December 31, 2023
U.S. treasuries	$	43,118	$	(50)	$	—	$	—
Government agency securities		34,885		(31)		—		—
Corporate debt		23,262		(33)		2,618		(15)
Total	$	101,265	$	(114)	$	2,618	$	(15)

The contractual maturities of securities classified as available-for-sale at June 30, 2024 were as follows:

	June 30, 2024
	Amortized		Estimated
	Cost		Fair Value
		(in thousands)
Due in one year or less	$	129,427	$	129,190
Due after one year through two years		1,516		1,506
Total	$	130,943	$	130,696

Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. There were no realized gains or losses, or unrealized losses from declines in fair value that are other than temporary, for the six months ended June 30, 2024 and 2023.

Accounts Receivable

Accounts receivable is presented net of an allowance for doubtful accounts of $1.0 million at June 30, 2024 and December 31, 2023. The Company considers its current expectations of future economic conditions when estimating its allowance for doubtful accounts.

Inventories

Inventories at June 30, 2024 and December 31, 2023 consist of the following:

	June 30,		December 31,
	2024		2023
	(in thousands)
Materials	$	140,977	$	139,884
Work-in-process		76,481		71,278
Finished goods		4,844		6,183
Evaluation inventory		22,806		20,290
Total	$	245,108	$	237,635

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets primarily consist of supplier deposits, prepaid value-added tax, lease deposits, prepaid insurance, prepaid software and maintenance, and other receivables. The Company had deposits with its suppliers of $17.3 million and $19.4 million at June 30, 2024 and December 31, 2023, respectively.

Property, Plant, and Equipment

Property, plant, and equipment at June 30, 2024 and December 31, 2023 consist of the following:

	June 30,		December 31,
	2024		2023
	(in thousands)
Land	$	5,061	$	5,061
Building and improvements		61,431		61,679
Machinery and equipment (1)		184,009		181,180
Leasehold improvements		53,009		52,913
Gross property, plant, and equipment		303,510		300,833
Less: accumulated depreciation and amortization		190,049		182,374
Net property, plant, and equipment	$	113,461	$	118,459

(1) Machinery and equipment also includes software, furniture and fixtures

For the three and six months ended June 30, 2024, depreciation expense was $4.8 million and $9.3 million, respectively and $4.0 million and $8.2 million, respectively, for the comparable 2023 period.

Goodwill

Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. There were no changes to goodwill during the six months ended June 30, 2024.

Intangible Assets

Intangible assets consist of purchased technology, customer relationships, patents, trademarks and tradenames, licenses, and backlog, and are initially recorded at fair value. Long-lived intangible assets are amortized over their estimated useful lives in a method reflecting the pattern in which the economic benefits are consumed or amortized on a straight-line basis if such pattern cannot be reliably determined.

The components of purchased intangible assets were as follows:

	June 30, 2024						December 31, 2023
			Accumulated						Accumulated
	Gross		Amortization				Gross		Amortization
	Carrying		and		Net		Carrying		and		Net
	Amount		Impairment		Amount		Amount		Impairment		Amount
	(in thousands)
Technology	$	355,928	$	324,071	$	31,857	$	355,928	$	321,923	$	34,005
Customer relationships		146,925		138,660		8,265		146,925		137,649		9,276
Trademarks and tradenames		30,910		30,806		104		30,910		30,269		641
Other		3,746		3,743		3		3,746		3,723		23
Total	$	537,509	$	497,280	$	40,229	$	537,509	$	493,564	$	43,945

Other intangible assets primarily consist of patents, licenses, and backlog.