Onto Innovation Inc. (NYSE: ONTO) announced on June 30, 2025, that it has entered into a definitive agreement to acquire the materials analysis business of Semilab International for $545 million. The transaction structure includes $475 million in cash and 706,215 shares of Onto Innovation common stock, with the total value based on the company's closing stock price on June 27, 2025.
Strategic Expansion in Materials Characterization
The acquisition brings four complementary product lines that provide inline wafer contamination monitoring and materials interface characterization capabilities. These technologies address the growing demand for advanced materials analysis as semiconductor manufacturing increasingly incorporates exotic materials. The portfolio has demonstrated strong market traction with approximately 20% compound annual growth rate since 2021.
"We're excited to welcome Semilab's talented materials characterization team to Onto Innovation," said Mike Plisinski, chief executive officer of Onto Innovation. "This acquisition expands our portfolio of process control technologies, which work together to help customers achieve their yield targets. This portfolio is exciting as it has demonstrated broad customer appeal and we see additional technical synergies with our modeling and acoustic metrology technologies, which we expect to provide additional benefit to our customers."
Financial Impact and Integration Plans
The materials analysis business is projected to generate approximately $130 million in annual revenue in 2025, adding significant scale to Onto Innovation's operations. The company expects the transaction to be immediately accretive to both gross and operating margins while increasing non-GAAP earnings per share by more than 10% in the first year following close.
Onto Innovation plans to enhance the customer value proposition by integrating its Ai Diffract™ modeling engine with the acquired technologies and leveraging advanced dimensional metrology capabilities. This integration is expected to accelerate yield learning for new devices across packaging, power semiconductors, and potentially advanced node applications.
Market Positioning and Growth Strategy
The acquisition aligns with Onto Innovation's strategic focus on high-growth, high-margin segments of the semiconductor value chain, particularly in areas where device complexity is accelerating. This includes the production of chips required for AI applications, where advanced materials analysis becomes increasingly critical for manufacturing success.
The company expects a smooth integration process, citing strong cultural and technical alignment between the two organizations. This acquisition reflects Onto Innovation's disciplined approach to capital allocation and commitment to long-term shareholder value creation in the expanding semiconductor process control market.
