Ultra Clean Holdings (UCTT)

Semiconductor-equipment subsystems supplier (UCTT) — UHP gas/fluid delivery + process modules that go inside AMAT/LRCX fab tools

AI exposure 48% — derived from reported segment revenue, not asserted.

Where it sits

Silicon Layer → Semiconductor Equipment · figures rebased to Q2 2026, reported 2026-08-03

UHP gas/fluid/chemical delivery systems, process modules, frame assemblies, precision robotics, weldments… leads 2 businesses in this sub-tier that together are 100% of revenue, so Semiconductor Equipment is effectively the whole company rather than one leg of it.

Reported segments

• Products — 88.8% of revenue
• Services — 11.2% of revenue

Ultra Clean Holdings ($644.9M Q2 2026 — a record). Products 88.8% ($572.7M) = primary B1 Semiconductor Equipment — gas and fluid delivery subsystems and frames built for the tool makers; Services 11.2% ($72.2M) — parts cleaning, coating and analytics. A subsystem supplier to Applied, Lam and their peers rather than a tool maker itself.

How the 48% is built

• Products — 88.8% of revenue × 50% AI-driven (disclosed). Subsystems ship into the wafer fab equipment that builds AI silicon, tracking the same WFE cycle as its customers
• Services — 11.2% of revenue × 30% AI-driven (disclosed). Parts cleaning and coating across the installed fab base, which is broader than the leading edge

Investment read

Moat. Qualified-supplier status and UHP contamination-control expertise as the largest outsourced subsystems partner to the WFE leaders — real switching friction, since requalifying a gas-delivery module or frame mid-ramp costs an OEM quarters, but not a defense: customers own the product designs and may license them to any competitor, Ichor holds the same qualifications at the same two anchor accounts, and the broader competitor set is generic EMS (Jabil, Celestica, Foxsemicon). Record Q2 2026 volume still priced at a 16.7% gross margin, which is pass-through economics, not pricing power. The…

Bottleneck / pricing power. Essentially no structural pricing power. Record revenue of $644.9M in Q2 2026 produced a 16.7% gross margin and 7.0% operating margin; the utilization-driven expansion from 5.1% is real operating leverage on volume, not terms UCTT can dictate. Top-two customer concentration in the high-50s percent means the OEMs set the price and the schedule.

Role in the AI stack. The sub-tier subsystems supplier — builds the UHP delivery systems and modules inside the fab tools, on the OEMs' terms.

Connected companies

• Applied Materials (AMAT) — UCTT supplies: Critical UHP subsystems/modules built into Applied Materials fab tools — AMAT is a top-2 customer (~part of 58.7% top-2 concentration)
• Lam Research (LRCX) — UCTT supplies: Critical UHP subsystems/modules built into Lam Research fab tools — LRCX is a top-2 customer (~part of 58.7% top-2 concentration)
• KLA Corporation (KLAC) — UCTT supplies: Qualified subsystems/precision-components supplier to KLA process-control tools (WFE customer)
• Teradyne (TER) — UCTT supplies: Qualified subsystems/components supplier to Teradyne test-equipment systems (WFE customer)
• MP Materials (MP) — UCTT is supplied by: Rare-earth oxide supply chains underlie plasma-resistant chamber coatings, but MP does not commercially separate yttria and no MP->UCT link is evidenced
• Lynas Rare Earths (LYC) — UCTT is supplied by: Lynas rare-earth feedstock underlies plasma-resistant coating powders via specialty refiners; no direct Lynas->UCT relationship is evidenced

Others in Semiconductor Equipment

• ASML Holding (ASML)
• Lam Research (LRCX)
• Applied Materials (AMAT)
• KLA Corporation (KLAC)
• Teradyne (TER)
• Onto Innovation (ONTO)

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