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Category: Brooks Automation (BKRS)
Date: 2 February 2021 Stock price of Brooks Automation (BKRS) $79.84 We take a more detailed look at Brooks Automation (BRKS) a leading global provider of manufacturing automation solutions for the semiconductor industry, and life science sample-based services and solutions for the life sciences market. In the semiconductor manufacturing market, we provide precision robotics, integrated automation systems, and contamination control solutions
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We are a leading global provider of manufacturing automation solutions for the semiconductor industry, and life science sample-based services and solutions for the life sciences market. In the semiconductor manufacturing market, we provide precision robotics, integrated automation systems, and contamination control solutions to semiconductor fabrication plants, or fabs and original equipment manufacturers"
More About Brooks Automation
We are a leading global provider of manufacturing automation solutions for the semiconductor industry, and life science sample-based services and solutions for the life sciences market. In the semiconductor manufacturing market, we provide precision robotics, integrated automation systems, and contamination control solutions to semiconductor fabrication plants, or fabs and original equipment manufacturers, or OEMs, worldwide. In the life sciences market, we offer a full suite of services and solutions for analyzing, managing, and storing biological and chemical compound samples to advance research and development for clinical, pharmaceutical, and other scientific endeavors.
Our life sciences solutions include gene sequencing and synthesis, a broad suite of high-throughput automated cryogenic storage products, related consumables, sample inventory software, as well as fully outsourced solutions for sample storage, transport, and inventory management. Our leadership positions and our global support capability in each of these markets make us a valued business partner to the largest semiconductor and semiconductor capital equipment manufactures, and pharmaceutical and life sciences research institutions in the world. In total, we employ approximately 3,200 full-time employees worldwide and have sales in more than 50 countries. We are headquartered in Chelmsford, Massachusetts and have operations in North America, Asia, and Europe.
Our life sciences solutions include gene sequencing and synthesis, a broad suite of high-throughput automated cryogenic storage products, related consumables, sample inventory software, as well as fully outsourced solutions for sample storage, transport, and inventory management. Our leadership positions and our global support capability in each of these markets make us a valued business partner to the largest semiconductor and semiconductor capital equipment manufactures, and pharmaceutical and life sciences research institutions in the world. In total, we employ approximately 3,200 full-time employees worldwide and have sales in more than 50 countries. We are headquartered in Chelmsford, Massachusetts and have operations in North America, Asia, and Europe.
Segments Of Brooks Automation
We serve the semiconductor capital equipment market through one operating and reportable segment, our Semiconductor Solutions Group segment. We serve the life sciences market through two operating and reportable segments: Brooks Life Sciences Products and Brooks Life Sciences Services. Prior to the fiscal year 2020, we had only two reportable segments that consisted of the Brooks Semiconductor Solutions Group segment and the Brooks Life Sciences segment. The Brooks Life Sciences segment consisted of two operating segments, Sample Management and GENEWIZ. During the fiscal year 2020, we realigned our life sciences businesses to combine the sample management services offerings under the leadership of our GENEWIZ genomic services business to form the Brook Life Sciences Services operating and reportable segment. By combining these two service-based businesses we believe we can more effectively leverage the potential for synergies as customers engage us to manage a broad variety of sample-based services including gene sequencing, gene synthesis, lab analysis, sample kitting and preparation, transportation, and storage. In the realignment we also formed our Brooks Life Sciences Products operating and reportable segment composed of product offerings of large automated ultra-cold stores, automated cryogenic storage systems, and consumables and instruments, and related product support services.
Markets And Customers Of Brooks Automation
The demand for semiconductors and semiconductor manufacturing equipment is cyclical, resulting in periodic
expansions and contractions. While our semiconductor business services element is generally more stable, the cyclical
nature of the capital equipment business causes sales from products to vary quarterly based on short-term market demands.
It is not unusual for these variations in sales to be up or down 10% to 20% in sequential quarters. As a result, our quarterly
and yearly semiconductor business sales have sometimes fluctuated. We expect future sales in this market will continue
to fluctuate between quarters and year-over-year.
The principal markets served by the Brooks Semiconductor Solutions Group segment include the following:
• Semiconductor capital equipment market
Each year, the global semiconductor industry makes significant capital investments to keep up with advancements in technology, to add manufacturing capacity and to improve productivity within existing fabs. While the global market for semiconductor capital equipment is cyclical, we believe that it possesses a long-term growth profile driven by the demand for increasingly sophisticated consumer electronics, automotive and smart appliance products, growth in data centers, the expansion of the Internet-of-Things which increasingly connects various appliances and devices to servers, and mobile communications infrastructure such as 5G networks. The expansion of innovative applications in the market translates to higher demand for semiconductor devices that typically require higher performance, lower power consumption and reduced size. The increase in manufacturing capacity and advancements of the chip technology are ultimately enabled by advancements in the processes and technology utilized to produce these chips. We believe this trend continues to provide market opportunities for the Brooks Semiconductor Solutions Group to be a valued partner supporting the industry’s needs. We have been a long-term partner to device manufacturers and OEMs who are the providers of tools to fabs. We maintain collaborative relationships with our customers for the innovative design of solutions that enable their equipment to have a process advantage and deliver improved cost of ownership in the fab. Our global network of technical specialists provides extensive support to our customers in all regions, including the key semiconductor markets in South Korea, Taiwan, China, Japan, Europe and the United States. We are recognized as a market leader in three critical sub-segments: vacuum automation for wafer handling; wafer automation for advanced packaging; and contamination control solutions.
The production of advanced semiconductor chips requires many complex and logistically challenging manufacturing activities. Silicon wafers must go through hundreds of process steps to create billions of microscopic transistors interconnected by a complex network of horizontal and vertical conducting layers to produce a functioning integrated circuit. These initial fabrication steps, which are referred to in the industry as front-end processes, are repeated many times on a single wafer to create the desired pattern on the silicon wafer. Up to 50% of these processes are performed in tools that operate under vacuum conditions, such as removing, depositing, or measuring materials on wafer surfaces. As semiconductors’ complexity has increased, the number of process steps that occur in a vacuum environment has also increased, resulting in a greater need for vacuum automation technology solutions. The increase in packing density of components in mobile devices has led the industry to devise advanced packaging techniques for chip interconnectivity using what is called wafer level packaging, or WLP. This advanced packaging technology combines multiple wafers before cutting them into pieces and then forming them onto a packaging substrate where they are ultimately divided into a multitude of chips. The recent increased adoption of WLP has increased the need for a contaminant free and high purity manufacturing environment, resulting in higher demand for our semiconductor offerings tailored to handle full wafer forms. It is the handling of these packaging substrates, which are often more complex to handle than standard silicon wafers, which require our sophisticated advanced packaging automation systems that are often customized for a specific customer substrate.
There is an increased demand for equipment that performs cleaning and conditioning of the wafer carriers which are used in all advanced semiconductor fabs. These cleaning tools remove microscopic particles, molecular contaminates and moisture attracted to the inside surface of the carrier. Automated cleaning and conditioning of the wafer carriers and EUV reticle carriers are also in demand as customers look to improve overall manufacturing yields. Similarly, as lithography also requires cleaner controlled environments, our reticle solutions provide contamination control for highly valued reticles or masks used in standard and EUV lithography for printing the technological features onto the wafer.
• Adjacent capital equipment markets
There are a few adjacent capital equipment markets that employ manufacturing processes similar to the semiconductor manufacturing industry. These markets include microelectromechanical systems, or MEMs devices, light-emitting diodes, or LEDs, Organic Light Emitting Diodes, or OLEDs, and touch screen technology. These markets and the semiconductor capital equipment market share common customers and utilize similar technology applications. For example, LEDs are manufactured using vacuum systems and handling processes similar to those used in semiconductor manufacturing. We believe the desire for efficient, higher throughput and extremely clean manufacturing for semiconductor wafer fabs, the chip packaging process and other industrial or high performance electronic-based products and processes have created a substantial market for us in the following offerings:
(i) substrate handling automation, which is related to moving the wafers in a semiconductor fab,
(ii) tool automation, which moves wafers from station-to-station,
(iii) vacuum systems
technology to create and sustain the clean environment necessary for fabricating various products, and
(iv) automated
contamination control systems to clean and condition substrate carriers.
expansions and contractions. While our semiconductor business services element is generally more stable, the cyclical
nature of the capital equipment business causes sales from products to vary quarterly based on short-term market demands.
It is not unusual for these variations in sales to be up or down 10% to 20% in sequential quarters. As a result, our quarterly
and yearly semiconductor business sales have sometimes fluctuated. We expect future sales in this market will continue
to fluctuate between quarters and year-over-year.
The principal markets served by the Brooks Semiconductor Solutions Group segment include the following:
• Semiconductor capital equipment market
Each year, the global semiconductor industry makes significant capital investments to keep up with advancements in technology, to add manufacturing capacity and to improve productivity within existing fabs. While the global market for semiconductor capital equipment is cyclical, we believe that it possesses a long-term growth profile driven by the demand for increasingly sophisticated consumer electronics, automotive and smart appliance products, growth in data centers, the expansion of the Internet-of-Things which increasingly connects various appliances and devices to servers, and mobile communications infrastructure such as 5G networks. The expansion of innovative applications in the market translates to higher demand for semiconductor devices that typically require higher performance, lower power consumption and reduced size. The increase in manufacturing capacity and advancements of the chip technology are ultimately enabled by advancements in the processes and technology utilized to produce these chips. We believe this trend continues to provide market opportunities for the Brooks Semiconductor Solutions Group to be a valued partner supporting the industry’s needs. We have been a long-term partner to device manufacturers and OEMs who are the providers of tools to fabs. We maintain collaborative relationships with our customers for the innovative design of solutions that enable their equipment to have a process advantage and deliver improved cost of ownership in the fab. Our global network of technical specialists provides extensive support to our customers in all regions, including the key semiconductor markets in South Korea, Taiwan, China, Japan, Europe and the United States. We are recognized as a market leader in three critical sub-segments: vacuum automation for wafer handling; wafer automation for advanced packaging; and contamination control solutions.
The production of advanced semiconductor chips requires many complex and logistically challenging manufacturing activities. Silicon wafers must go through hundreds of process steps to create billions of microscopic transistors interconnected by a complex network of horizontal and vertical conducting layers to produce a functioning integrated circuit. These initial fabrication steps, which are referred to in the industry as front-end processes, are repeated many times on a single wafer to create the desired pattern on the silicon wafer. Up to 50% of these processes are performed in tools that operate under vacuum conditions, such as removing, depositing, or measuring materials on wafer surfaces. As semiconductors’ complexity has increased, the number of process steps that occur in a vacuum environment has also increased, resulting in a greater need for vacuum automation technology solutions. The increase in packing density of components in mobile devices has led the industry to devise advanced packaging techniques for chip interconnectivity using what is called wafer level packaging, or WLP. This advanced packaging technology combines multiple wafers before cutting them into pieces and then forming them onto a packaging substrate where they are ultimately divided into a multitude of chips. The recent increased adoption of WLP has increased the need for a contaminant free and high purity manufacturing environment, resulting in higher demand for our semiconductor offerings tailored to handle full wafer forms. It is the handling of these packaging substrates, which are often more complex to handle than standard silicon wafers, which require our sophisticated advanced packaging automation systems that are often customized for a specific customer substrate.
There is an increased demand for equipment that performs cleaning and conditioning of the wafer carriers which are used in all advanced semiconductor fabs. These cleaning tools remove microscopic particles, molecular contaminates and moisture attracted to the inside surface of the carrier. Automated cleaning and conditioning of the wafer carriers and EUV reticle carriers are also in demand as customers look to improve overall manufacturing yields. Similarly, as lithography also requires cleaner controlled environments, our reticle solutions provide contamination control for highly valued reticles or masks used in standard and EUV lithography for printing the technological features onto the wafer.
• Adjacent capital equipment markets
There are a few adjacent capital equipment markets that employ manufacturing processes similar to the semiconductor manufacturing industry. These markets include microelectromechanical systems, or MEMs devices, light-emitting diodes, or LEDs, Organic Light Emitting Diodes, or OLEDs, and touch screen technology. These markets and the semiconductor capital equipment market share common customers and utilize similar technology applications. For example, LEDs are manufactured using vacuum systems and handling processes similar to those used in semiconductor manufacturing. We believe the desire for efficient, higher throughput and extremely clean manufacturing for semiconductor wafer fabs, the chip packaging process and other industrial or high performance electronic-based products and processes have created a substantial market for us in the following offerings:
(i) substrate handling automation, which is related to moving the wafers in a semiconductor fab,
(ii) tool automation, which moves wafers from station-to-station,
(iii) vacuum systems
technology to create and sustain the clean environment necessary for fabricating various products, and
(iv) automated
contamination control systems to clean and condition substrate carriers.
Product And Service Offering Of Brooks Automation
The principal offerings of the Brooks Semiconductor Solutions Group segment consist of: (i) wafer handling robotics and integrated systems and (ii) semiconductor contamination control solutions. The segment also provides support services, including repair and refurbishment, diagnostics and installation, and spare parts and enhancement upgrades to optimize tool productivity.
Wafer handling robotics and integrated systems - include vacuum robots, atmospheric robotic modules, and tool automation systems that provide precision handling and clean wafer environments. In the semiconductor industry, wafer handling represents a critical technology that is an integral component of highly complex production tools that run in the world’s most advanced wafer fabs. A typical customer tool is designed and built around a process chamber and uses automation technology to move wafers in and out of the chamber. We specialize in developing and building these automated handling systems and the vacuum technologies used in these tools. We provide individual automation components within an OEM customer system as well as complete integrated handling systems. We provide automation products designed to improve manufacturing performance and productivity for both atmospheric pressure and vacuumbased tools.
Contamination control solutions - include automated cleaning and inspection systems for wafer carriers, reticle pod cleaners, and stockers, which are automated systems that store wafers or reticles. Our products are used to remove contaminants that result from critical airborne contamination within the workflow of the manufacturing process. Our solutions contribute to improved yields, productivity and process stability in the manufacturing process which requires an ultra-clean manufacturing environment for leading-edge chips with geometries below 20 nanometers. We sell our products and services to the world’s major semiconductor chip makers and to OEMs, who provide process tools to those same chip makers. Our customers outside the semiconductor industry are broadly diversified. We have major customers in North America, Europe and Asia. Although we ship much of our equipment to OEMs in the United States, many of these OEM tools are ultimately installed in semiconductor fabs that are outside of North America. Thus, we also provide support services to leading OEMs, fabs and foundries across the globe.
Wafer handling robotics and integrated systems - include vacuum robots, atmospheric robotic modules, and tool automation systems that provide precision handling and clean wafer environments. In the semiconductor industry, wafer handling represents a critical technology that is an integral component of highly complex production tools that run in the world’s most advanced wafer fabs. A typical customer tool is designed and built around a process chamber and uses automation technology to move wafers in and out of the chamber. We specialize in developing and building these automated handling systems and the vacuum technologies used in these tools. We provide individual automation components within an OEM customer system as well as complete integrated handling systems. We provide automation products designed to improve manufacturing performance and productivity for both atmospheric pressure and vacuumbased tools.
Contamination control solutions - include automated cleaning and inspection systems for wafer carriers, reticle pod cleaners, and stockers, which are automated systems that store wafers or reticles. Our products are used to remove contaminants that result from critical airborne contamination within the workflow of the manufacturing process. Our solutions contribute to improved yields, productivity and process stability in the manufacturing process which requires an ultra-clean manufacturing environment for leading-edge chips with geometries below 20 nanometers. We sell our products and services to the world’s major semiconductor chip makers and to OEMs, who provide process tools to those same chip makers. Our customers outside the semiconductor industry are broadly diversified. We have major customers in North America, Europe and Asia. Although we ship much of our equipment to OEMs in the United States, many of these OEM tools are ultimately installed in semiconductor fabs that are outside of North America. Thus, we also provide support services to leading OEMs, fabs and foundries across the globe.
Sales, Marketing and Customer Support Of Brooks Automation
We market and sell most of our semiconductor products and services in Asia, Europe, the Middle East and North America through our direct sales organization. The sales process for our products is often multilevel, involving a team comprised of individuals from sales, marketing, engineering, operations and senior management. In many cases we assign a team to a customer who engages the customer at different levels of its organization to facilitate planning, provide product customization when required, and ensure open communication and support.
The majority of our life sciences sales are completed through our direct Brooks Life Sciences sales force, particularly our store systems, storage services, and genomic services. We supplement the sale of consumables and instruments with distributors that reach a broad range of customers. In regions with emerging life science industries such as China, India and the Middle East, we leverage local distributors to assist with the sales process for store systems. Our larger sample management systems sales process may take months to complete and may involve a team from sales, marketing, and engineering. Sales of genomic services are generally generated with on-line orders from the customer lab and delivered via a courier service, with the simplest of sequencing completed in less than 24 hours and more complex synthesis tasks within weeks.
We typically provide product warranties for a period of one to two years depending on the product type. Our marketing activities include participation in trade shows, seminars, participation in industry forums, creation and distribution of sales literature and white papers, publication of press releases and articles in business and industry publications. We maintain sales and service centers in Asia, Europe, the Middle East and North America to enhance our customers’ support and communication.
The majority of our life sciences sales are completed through our direct Brooks Life Sciences sales force, particularly our store systems, storage services, and genomic services. We supplement the sale of consumables and instruments with distributors that reach a broad range of customers. In regions with emerging life science industries such as China, India and the Middle East, we leverage local distributors to assist with the sales process for store systems. Our larger sample management systems sales process may take months to complete and may involve a team from sales, marketing, and engineering. Sales of genomic services are generally generated with on-line orders from the customer lab and delivered via a courier service, with the simplest of sequencing completed in less than 24 hours and more complex synthesis tasks within weeks.
We typically provide product warranties for a period of one to two years depending on the product type. Our marketing activities include participation in trade shows, seminars, participation in industry forums, creation and distribution of sales literature and white papers, publication of press releases and articles in business and industry publications. We maintain sales and service centers in Asia, Europe, the Middle East and North America to enhance our customers’ support and communication.
Competition Of Brooks Automation
Brooks’ Semiconductor Solutions Group segment operates in various market segments of varying breadth with differing competitors and competitive dynamics. The semiconductor and adjacent technology markets, and process equipment manufacturing industries, are highly competitive and characterized by continual changes and technology improvements. A significant portion of equipment automation is still done by the OEMs themselves.
Our competitors
among merchant vacuum robot automation suppliers include primarily Japanese companies, such as Daihen Corporation, Daikin Industries, Ltd., Rorze Corporation, and Sumitomo Heavy Industries, as well as Korea-based RaonTech. Atmospheric tool automation is typically less demanding technologically, has fewer barriers to entry and has a larger field of competitors. We compete directly with other equipment automation suppliers of atmospheric modules and systems, such as Hirata Corporation, Kawasaki Heavy Industries, Ltd., Genmark Automation, Inc., Rorze Corporation, Sankyo Seisakusho Co., Ltd., TDK Corporation and Sinfonia Technology Co., Ltd. Our Contamination Control Solutions business competes with suppliers of automated wafer carrier cleaning equipment such as Device Engineering and Hugle. We believe our customers will purchase our equipment, automation products and vacuum subsystems as long as our products continue to provide the necessary throughput, reliability, contamination control and accuracy at an acceptable price. We believe our semiconductor offerings are competitive with respect to all of these factors. However, we cannot guarantee that we will be successful in selling our products to OEMs who currently satisfy a portion of their automation needs in-house or from other independent suppliers, regardless of the performance or price of our products. Given the breadth of the sample management solutions and genomic services offered by the Brooks Life Sciences segments, there are no direct competitors for the comprehensive set of product and service solutions we provide to our customers. Each of the business lines within the Brooks Life Sciences segments, however, has unique competitors in their area of offerings. This includes Hamilton Company and Liconic AG for automation systems, Thermo-Fisher for consumables and services, Covance and LabCorp for storage services, and BGI, Eurofins, GenScript, Integrated DNA Technologies, and Twist for genomic services.
Our competitors
among merchant vacuum robot automation suppliers include primarily Japanese companies, such as Daihen Corporation, Daikin Industries, Ltd., Rorze Corporation, and Sumitomo Heavy Industries, as well as Korea-based RaonTech. Atmospheric tool automation is typically less demanding technologically, has fewer barriers to entry and has a larger field of competitors. We compete directly with other equipment automation suppliers of atmospheric modules and systems, such as Hirata Corporation, Kawasaki Heavy Industries, Ltd., Genmark Automation, Inc., Rorze Corporation, Sankyo Seisakusho Co., Ltd., TDK Corporation and Sinfonia Technology Co., Ltd. Our Contamination Control Solutions business competes with suppliers of automated wafer carrier cleaning equipment such as Device Engineering and Hugle. We believe our customers will purchase our equipment, automation products and vacuum subsystems as long as our products continue to provide the necessary throughput, reliability, contamination control and accuracy at an acceptable price. We believe our semiconductor offerings are competitive with respect to all of these factors. However, we cannot guarantee that we will be successful in selling our products to OEMs who currently satisfy a portion of their automation needs in-house or from other independent suppliers, regardless of the performance or price of our products. Given the breadth of the sample management solutions and genomic services offered by the Brooks Life Sciences segments, there are no direct competitors for the comprehensive set of product and service solutions we provide to our customers. Each of the business lines within the Brooks Life Sciences segments, however, has unique competitors in their area of offerings. This includes Hamilton Company and Liconic AG for automation systems, Thermo-Fisher for consumables and services, Covance and LabCorp for storage services, and BGI, Eurofins, GenScript, Integrated DNA Technologies, and Twist for genomic services.
Brooks Automation (BRKS) stock price chart over the last 5 years
The image below shows the stock price history of Brooks Automation (BRKS) over the last 5 years. And its been a pretty average time for the stock of Brooks (BRKS). Over the last 5 years the stock of Brooks Automation increased by a whopping 717.4%. There is no investor that would say no those type of returns
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