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Item 1. Business

2020-11-18 compared with 2019-12-17 · 180 added, 144 removed, 87 unchanged (79% of the section changed)

We are a leading provider of semiconductor manufacturing automation solutions and life science sample-based services and solutions worldwide.

In the semiconductor manufacturing market, we have been a provider of precision robotics, integrated automation systems and services for more than 40 years.

In the life sciences market, we apply our automation and cryogenics expertise to offer a full suite of sample-based services and products, including a full line of cold chain management solutions for handling and storing biological and chemical compound samples used in areas such as drug development, clinical research and advanced cell therapies.

We are also a global provider of gene sequencing and gene synthesis services.

We believe our leadership positions and our global support capability in each of these markets make us a valued business partner to the largest semiconductor capital equipment device makers, and pharmaceutical and life science research institutions in the world.

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.

Since our founding in 1978, we have been a leading partner to the global semiconductor manufacturing industry.

We initially developed and marketed automated silicon wafer handling equipment for semiconductor equipment manufacturers.

Since then, we have expanded our products and services through product development initiatives and acquisitions, and we are now recognized as a leading provider of vacuum robots, vacuum automation systems, wafer

carrier contamination control systems, and reticle storage solutions to the global semiconductor capital equipment industry.

We sell our semiconductor products and services to both original equipment manufacturers, or OEMs, and directly to global chip manufacturers.

In April 2018, we acquired Tec-Sem Group AG, or Tec-Sem, a Switzerland-based manufacturer of semiconductor fabrication automation equipment with a focus on reticle storage management systems that support the needs for advanced lithography.

Prior to fiscal year 2016, we made several acquisitions that support our business in the semiconductor market.

Semiconductor

Since our founding in 1978, we have been a leading automation provider and partner to the global semiconductor manufacturing industry.

We provide advanced, high precision, high throughput robots, vacuum automation systems, contamination control systems, and reticle storage solutions to the global semiconductor capital equipment industry.

We sell our semiconductor products and services both to OEMs and directly to global semiconductor chip manufacturers.

We have significant investments in the engineering disciplines to design and advance capabilities in precise automation, high-speed, contaminant-free and vacuum environments, and contamination elimination.

Our engineering organization develops new automation capabilities and product offerings, and partners with customers to integrate our offerings into their tools which are part of the semiconductor manufacturing process.

In April 2018, we supplemented our portfolio of offerings with the acquisition of Tec-Sem Group AG, a Switzerland-based manufacturer of reticle storage management systems that support the needs for advanced lithography.

The reticle storage business is managed and reported as a part of our Contamination Controls Solutions reporting unit.

On July 1, 2019, we completed the sale of our semiconductor cryogenics business to Edwards Vacuum LLC (a member of the Atlas Copco Group) for approximately $675 million in cash subject to adjustments for working capital and other items.

We have also invested in research and development initiatives to advance the offerings acquired in these acquisitions, as well as in our vacuum automation and services offerings.

Our business supporting the semiconductor capital equipment and adjacent markets provided approximately 57% of our revenue in fiscal year 2019.

We entered the life sciences market, specifically in the area of sample management storage systems, in 2011.

We entered this market based on our ability to leverage our core technology competencies in automation and cryogenics into our sample management offerings.

We applied these competencies to provide a range of automated ultra-cold freezer systems and then to expand into a portfolio of products and services to assist customers in efficiently managing the end-to-end “cold chain of custody” of their chemical compound and biological samples.

Today, we are a leading provider of the life sciences sample management solutions for automated cold sample storage systems, off-site storage services, and consumables and instruments.

We are also a provider of software offerings which enable or enhance our customers’ visibility into their sample inventories, and laboratory services at our storage service locations, both of which are expected to help our customers accelerate their research and development efforts.

Taken together, we believe our sample management product and services offerings allow our customers to maintain a complete “cold chain of custody” and enhance efficiency of related workflow for their samples.

On November 15, 2018, we significantly expanded our life sciences offerings with the acquisition of GENEWIZ Group, or GENEWIZ, a leading provider of gene sequencing and gene synthesis services to pharmaceutical, biotechnology and academic institutions around the world.

Our semiconductor equipment business provided approximately 57% of our revenue in the fiscal year 2020.

The semiconductor capital equipment market has delivered overall long-term growth in excess of global gross domestic product (GDP) while also experiencing short-term cycles of sequential decreases and increases of sales.

The cycles are influenced by the technological trends of the semiconductor industry and sometimes by the economic trends of the global economy.

Life Sciences

We are a leading provider of life sciences services and products supporting the analysis, storage, and management of biological and chemical compound samples for pharmaceutical, biotech, clinical, healthcare and academic institutions worldwide.

We offer advanced automated solutions for cryogenic sample storage, capable of efficiently handling and managing both small and immense populations of biological samples to ensure end-to-end “cold chain of custody” of customer samples.

We are a leading commercial provider of fully outsourced storage and transport of biological samples.

We offer a broad range of genomic services including sequencing, synthesis and gene editing.

We are a leading provider of automated cold sample storage systems, consumables, and instruments, and informatics solutions, enabling or enhancing our customers’ visibility into their sample inventories and help them to manage their laboratory workflows.

We are also a leading life sciences service provider of outsourced sample storage and management, as well as genomic services which include Sanger sequencing, high throughput/next generation sequencing, bioinformatics, gene synthesis, molecular biology, and good laboratory practices, or GLP, regulatory services.

Taken all together, we believe our life sciences sample management product and services offerings allow our customers to maintain a complete “cold chain of custody” and enhance efficiency of related workflows for their samples.

With our genomic services offering, we can add more value to the samples under our care to assist our customers in advancing their research and discoveries.

Our research and development teams and our services teams possess significant specialized expertise in cryogenics, refrigeration, automation, biological and molecular sciences, and expertise for preparing and processing biological samples for analysis and testing.

Our teams develop new products, enhanced workflow solutions, sample management software solutions, and innovative sample preparation protocols.

As a result of these innovations, the business holds significant intellectual property and has enabled many loyal customer relationships.

Our life sciences portfolio includes products and services that we acquired to bring together a comprehensive capability to service our customers’ needs in the sample-based services arena.

We continue to develop the acquired products and services offerings through the combined expertise of the newly acquired teams and our existing research and development resources.

This acquisition, investment, and integration approach has allowed us to accelerate our

internal development and that of the acquired entity, significantly decreasing our time to market.

Our recent acquisitions include the following:

In November 2018, we acquired GENEWIZ Group, or GENEWIZ, a leading provider of gene sequencing and gene synthesis services to pharmaceutical, biotechnology and academic institutions around the world.

GENEWIZ is headquartered in New Jersey and has a network of genomics laboratories spanning the United States, China, Japan, Germany, and the United Kingdom.

We believe the GENEWIZ acquisition, combined with our core capabilities in sample management services, positions us to add more value to samples under our care.

In addition to the GENEWIZ acquisition, over the last four fiscal years we have completed six acquisitions to expand and enhance our life science sample management offerings and establish a comprehensive portfolio of sample management solutions.

Three of these acquisitions were outsourced sample management services companies.

● In November 2015, we acquired BioStorage Technologies, Inc., a full-service outsourcing sample management business, supporting customers in the United States, Europe, and Asia with an integrated solution for off-site storage services, transportation services, laboratory services and software-based inventory management.

● In July 2017, we acquired substantially all of the assets and certain liabilities of Pacific Bio-Material Management, Inc.

and Novare, LLC, two companies with operations in California and New York, respectively, providing off-site storage, transportation, and management services for biological samples.

● In April 2018, we acquired BioSpeciMan Corporation, a Canada-based provider of off-site storage services for biological sample materials.

Other recent acquisitions also added cryogenic temperature management products, software products and consumable products to our life sciences portfolio.

● In November 2016, we completed the acquisition of Cool Lab, LLC, a subsidiary of BioCision, LLC, a provider of cryogenic product solutions that assist in managing temperature stability of biological samples in a laboratory environment.

● In August 2017, we acquired certain assets and liabilities from RURO, Inc.

related to FreezerPro ® , a web-based software platform which aids customers in their sample management needs, and became the exclusive distributor of BiobankPro ® , a software system that manages sample processing and storage while providing a single location for research and clinical data and related analysis.

● In October 2017, we acquired 4titude Limited, or 4titude, a U.K.-based manufacturer of scientific consumables used in a variety of genomic analytical applications.

Through the acquisitions described above, we have expanded product and service offerings, accelerated product development cycles, broadened our installed base and added customer relationships to our life science business.

As such, we use acquisitions and divestitures to strengthen our portfolio and achieve increased growth and profitability.

For further information on our acquisitions and equity investments, please refer to Note 4, “Acquisitions,” and Note 8, “Equity Method and Other Investments,” to our Consolidated Financial Statements included under Item 8, “Financial Statements and Supplementary Data” of this Form 10-K.

Our business supporting the life sciences market provided approximately 43% of our revenue in fiscal 2019.

We believe the life science market is generally more stable than the semiconductor capital equipment market and we expect that, over the long term, it will grow at a higher rate than our semiconductor business which historically has displayed cyclical trends related to demand for capital investments.

Within the life sciences business, revenue comes from storage services and genomic services that are provided to thousands of customers and are generally more predictable than the sale of automated sample storage equipment, which has historically displayed uneven sales due to large purchases and fewer customers.

We have three operating segments aggregated into two reportable segments consisting of Brooks Semiconductor Solutions Group segment and Brooks Life Sciences segment.

For further information on our operating segments, please refer to Note 21, “Segment and Geographic Information” to our Consolidated Financial Statements included under Item 8, “Financial Statements and Supplementary Data” of this Form 10- K.

The GENEWIZ services, combined with our core capabilities in sample management services, position us to add more value to samples under our care and provide more comprehensive solutions to our customer base.

In February 2020, we acquired RURO, Inc., or RURO, an informatics software company based in Maryland.

RURO offers cloud-based software solutions that manage laboratory workflow and bio-sample data for a broad range of customers in the biotech, healthcare, and pharmaceutical sectors.

RURO's capabilities and offerings enable us to offer enhanced on-site and off-site management of biological sample inventories and integration solutions for customers’ distributed workflow.

For further information on our acquisitions, please refer to Note 4, “Acquisitions” to our Consolidated Financial Statements included under Item 8, “Financial Statements and Supplementary Data” of this Form 10-K.

Our life sciences businesses provided approximately 43% of our revenue in fiscal 2020.

As the market of cell-based research is vast and growing, it is driving continued growth in the services and product offerings for the analysis and management of samples.

Our customer list numbers in the thousands and we address only a fraction of the industry.

We serve the largest customers in the pharmaceutical industry, the most advanced research hospitals performing clinical research and therapy development, as well as some of the newest and leading-edge start-ups in the biotech space.

We also serve academic and government institutions.

We believe that the sample-based services and products business will continue to demonstrate a high growth trajectory and we do not observe cyclical characteristics in demand for these offerings.

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.

For further information on our reportable and operating segments, please refer to Note 20, “Segment and Geographic Information” to our Consolidated Financial Statements included under Item 8, “Financial Statements and Supplementary Data” of this Form 10- K.

Brooks Semiconductor Solutions Group Segment

Brooks Semiconductor Solutions Group is a leader in wafer automation and contamination controls solutions and services that are designed to improve throughput, yield, and cost of ownership of complex processing equipment, or tools, in semiconductor fabrication plants, or fabs.

Our product offerings include vacuum and atmospheric robots, turnkey vacuum and atmospheric wafer handling systems, as well as wafer carrier clean and reticle storage systems.

We also capture the complete life cycle of value through a global service network of expert application and field engineers who are located close to our customers.

Our services include rapid refurbishment of robots to stringent specifications, upgrades to improve equipment productivity, and proactive monitoring and diagnostics for predictive risk management and improved up-time of the installed base.

Brooks Semiconductor Solutions Group is a leader in wafer automation, contamination controls solutions, and related support services.

Our offerings are designed to enhance capabilities and efficiencies of the manufacturing process of semiconductor fabs through improved throughput, yield, and cost of ownership of complex processing equipment.

Our product offerings include vacuum and atmospheric robots, turnkey vacuum and atmospheric wafer handling systems, as well as wafer carrier cleaning and reticle storage systems.

Our service network of expert application and field engineers, who are generally located close to our customers, provides rapid refurbishment of robots to stringent specifications, upgrades to improve equipment productivity, and proactive monitoring and diagnostics for predictive risk management and improved up-time of the installed base.

Markets and Customers

The demand for semiconductors and semiconductor manufacturing equipment is cyclical, resulting in periodic expansions and contractions of this market.

While the services element of our semiconductor business 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.

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 sales have fluctuated in this market and we expect future sales in this market will continue to fluctuate between quarters and year-over-year.

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 in equipment to keep up with advancements in semiconductor technology, to add manufacturing capacity and to improve productivity within existing fabs.

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;

contamination control;

and wafer automation for advanced packaging.

As discussed above, the global semiconductor capital equipment industry is cyclical, but 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.

The demand for higher performance, lower power consumption and reduced size for all of these products is enabled by advancements in the technology and processes used for the manufacturing of the devices.

We believe this trend continues to provide market opportunities for the Brooks Semiconductor Solutions Group to be a valued partner in support of 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 our customers to have a valued wafer process advantage and 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 Korea, Taiwan, China, Japan, Europe and the United States.

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 in order to create billions of microscopic transistors and connect them in both horizontal and vertical layers to produce a functioning integrated circuit, or IC.

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 the complexity of semiconductors has increased, the number of process steps that occur in a vacuum environment have also increased, resulting in a greater need for vacuum automation technology solutions.

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 is a process of combining multiple wafers together prior to cutting them into pieces and then forming them onto a packaging substrate where they are ultimately divided into the multitude of chips.

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.

We believe there is a growing demand for equipment to perform cleaning and conditioning of the wafer carriers which are used in all advanced semiconductor fabs.

These cleaning tools remove microscopic particles, organic compounds and water that are attracted to the inside surface of the carrier.

Automated cleaning and conditioning of the wafer carriers are also in demand as customers look to improve overall manufacturing yields.

Similarly, as lithography also requires cleaner controlled environments, our reticles solutions provide contamination control for highly valued reticles or masks that are used in printing the technological features onto the wafer.

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 use manufacturing processes similar to the semiconductor manufacturing industry.

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.

example, LEDs are manufactured using vacuum systems and handling processes similar to those used in semiconductor manufacturing.

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:

2 unchanged sentences

The principal offerings of the Brooks Semiconductor Solutions Group segment consist of:

(i) wafer handling robotics and systems and (ii) semiconductor contamination control solutions.

The segment also provides support services, including repair, diagnostic and installation, as well as spare parts and productivity enhancement upgrades to enhance tool productivity.

Wafer handling robotics and systems offerings - 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 in the highly complex production tools in the world’s most advanced wafer fabs.

(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 the automated handling systems and the vacuum technologies used in these tools.

We provide individual components within an OEM customer system and complete integrated handling systems.

We provide automation products that are used for both atmospheric pressure and vacuum-based tools and are designed to improve performance and productivity of the manufacturing process.

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 vacuum-based 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 critical airborne contamination within the workflow of the manufacturing process.

Our solutions contribute to improving yields, productivity and process stability in the manufacturing process which requires an ultra-clean manufacturing environment.

Within the semiconductor industry, we sell our products and services to the world’s major semiconductor chip makers and OEMs, who provide process tools to the IC makers for the manufacture of chips.

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 OEMs in the United States, a large percentage of these OEM tools are ultimately installed in semiconductor fabs that are outside of North America.

We also provide support services to leading OEMs, fabs and foundries across the globe.

Brooks Life Sciences Segment

Our Brooks Life Sciences segment is a global leader of comprehensive sample management solutions and genomic services, providing pharmaceutical, biotechnology, and academic customers with complete end-to-end “cold-chain of custody” and gene sequencing and synthesis solutions to advance scientific research and support drug development.

Our sample management solutions are focused on providing customers with the highest level of sample quality, security, availability, intelligence and integrity throughout the life cycle of samples.

Our solutions include automated ultra-cold storage systems, off-site storage services, transport services, laboratory services, consumables and instruments.

We also provide informatics solutions that manage samples throughout our customers’ research discovery and development work flows.

Our key genomic services include gene sequencing on Sanger and Next-Generation platforms, and gene synthesis.

Our workforce has deep scientific knowledge and utilizes our proprietary technologies and services, and is supported by a network of 13 global laboratories spanning the United States, China, Japan, Germany, and the United Kingdom.

We believe this has positioned us to provide our customers with a valued combination of speed, convenience and scientific expertise in our service offerings.

As referenced above, we completed the acquisition of GENEWIZ in November 2018.

GENEWIZ is a leading global provider of genomic analysis and gene synthesis services.

We believe GENEWIZ’s solutions have significantly expanded our offerings to our existing sample management customers.

GENEWIZ has been in business since 1999 and provides analysis of millions of samples collected by researchers in pharmaceutical, academic, government, and clinical areas as well as gene synthesis capabilities.

Life Science Market

Brooks Life Sciences serves a broad range of end markets within the life sciences industry to address a confluence of life science industry trends, such as technology, information management and new sophisticated tools and applications.

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.

Brooks Life Sciences Products and Brooks Life Sciences Services

Our life sciences businesses are comprised of two reportable segments, Life Sciences Products segment and Life Sciences Services segment.

Our Life Sciences Products business is a leading provider of automated ultra-cold storage solutions for biological and chemical compound samples.

Our storage systems provide reliable automation and sample inventory management at temperatures down to -196°C and can store anywhere from thousands to millions of samples.

Our sample management solutions include consumable vials and tubes, PCR plates, instruments for supporting workflow, and informatics, all of which focus on providing customers with the highest level of sample quality, security, availability, intelligence and integrity throughout the lifecycle of samples providing customers with complete end-to-end “cold-chain of custody” capabilities.

Our Life Sciences Services business is a leading provider of solutions addressing the many needs of customers in the area of genomic analysis and the management and care of biological samples used in pharmaceutical, biotech, healthcare, clinical, and academic R&D markets.

Millions of samples are processed every year, each containing valuable information that must be preserved with the sample.

Through our genomic services we provide a broad capability to customers for sequencing and synthesis of genes.

Our sample management services include off-site storage services, transport services, laboratory services, and interactive informatics solutions.

We also provide expert-level consultation services to our clients throughout their experimental design and implementation.

Our services also include short- and long-term sample storage and management of the “cold chain of custody” from collection, to storage, to retrieving the sample which ultimately may go back into the customer’s research workflow.

As referenced above, in November 2018, we completed the acquisition of GENEWIZ, a leading global provider of genomic analysis and gene synthesis services.

In February 2020, we acquired RURO, a software company providing innovative solutions for managing biological sample inventory and workflows for the life sciences market.

We believe the combination of our broad sample-based offerings, including genomic analysis, sample management services, automated storage systems, and informatic solutions has meaningfully enhanced our ability to meet our customers’ demands with a single and more comprehensive relationship.

Life Sciences Market

Our life sciences businesses serve a broad range of end markets within the life sciences industry to address a confluence of life sciences trends, such as technology, information management and new sophisticated tools and applications.

With the advent of biologics and personalized medicine, biological samples have become critical assets to the success of drug and therapy pipelines, and the proper management and protection of these samples has gained increased importance to our customers.

We believe this trend has created a sizable market opportunity for Brooks Life Sciences to provide comprehensive sample management and genomic solutions.

Since the mapping of the of the full human genome at the turn of this century, the market for genomic services has grown in support of the demands in biologic drug development, personalized medicine and cell/gene therapy.

Top pharmaceutical and biotechnology companies are able to use their own in-house laboratory resources to sequence the billions of genes needed as part of their research work-flow but many of the companies look to outsource their gene sequencing to independent laboratories that provide expedited results with expertise.

We believe this trend has created a sizable market opportunity for Brooks to provide comprehensive sample management and genomic solutions.

Since the successful mapping of the full human genome at the turn of this century, the market for genomic services has grown in support of research in biologic drug development, personalized medicine and cell/gene therapy.

Top pharmaceutical and biotechnology companies can use their in-house laboratory resources to sequence the millions of genes needed as part of their research workflow.

Still, many companies look to outsource their gene sequencing to independent laboratories that provide expedited results and expert consultative services.

Other companies and institutions have fewer or no in-house options and make use of outsourced capabilities as their primary solution.

GENEWIZ participates in this market as a value-added laboratory offering precise genetic testing services with fast turnaround time.

The Brooks Life Sciences segment currently serves customers around the globe, including all of the top- 20 global bio-pharmaceutical companies.

Due to the comprehensive nature of our sample management and genomic services solutions, we are continuing to expand our customer base and geographic reach to increase our revenue streams with the goal of delivering consistent growth over the long-term.

GENEWIZ has more than 4,000 customers globally, which includes many of our over 1,500 sample management customers.

Product and Service Offerings

The principal offerings of the Brooks Life Sciences segment include the following:

Automated cold storage systems – provides stand-alone systems that typically store one to two million samples each in temperature ranges from +4°C to -196°C.

GENEWIZ participates in this market as a value-added laboratory services provider, offering high quality genetic testing services with fast turnaround time.

The Brooks life sciences businesses currently serve customers worldwide, including all of the top-20 global bio-pharmaceutical companies.

Due to the comprehensive nature of our sample management and genomic services solutions,

we are continuing to expand our customer base and geographic reach.

We have more than 7,000 customers globally, and we continue to add new customers each quarter.

Brooks Life Sciences Products Offerings

The principal offerings of the Brooks Life Sciences Products segment include the following:

Automated ultra-cold storage systems – provides stand-alone systems that typically store one to two million samples each in temperature ranges from +4°C to -196°C.

Our systems provide high throughput capability and optimized storage of multi-format tubes and plates and increased storage capacity while maintaining consistent temperature profiles across stored samples.

We also provide support services for our installed base of storage systems.

Sample management services - includes a complete range of services consisting of on-site and off-site sample storage, cold chain logistics, sample transport and collection relocation, bio-processing solutions (inclusive of sample preparation, and genomic and cell culture analysis), disaster recovery and business continuity, as well as project management and consulting.

Genomic Services - provides gene sequencing and gene synthesis services, a service which enables the fast-expanding research of gene-based healthcare discoveries and therapies through our acquisition of GENEWIZ.

These service offerings include Sanger sequencing, gene synthesis, molecular biology, high throughput and Next Generation sequencing, or NGS, bioinformatics, and good laboratory practices, or GLP, regulatory services.

Consumables and Instruments - includes a complete range of unique consumables, including multiple formats of racks, tubes, caps, plates and foils, which support storage of samples prior to placing them in ultra-cold storage environment.

We also offer support services for our installed base of storage systems.

Consumables and Instruments - includes a complete range of consumables, including multiple formats of racks, tubes, caps, plates and foils, which are used for storage and handling of samples in ambient and ultra-cold storage environments.

A comprehensive range of instruments used for labeling, bar coding, capping, de-capping, auditing, sealing, peeling, and piercing tubes and plates complement our consumables.

Our offerings acquired with 4titude include a range of products aimed at the genomic sample preparation and services market for polymerase chain reactions, or PCR, & sequencing, imaging, plate sealing, liquid handling, forensic and NGS, sample processing.

Our offerings include a range of products aimed at the genomic sample preparation and services market for polymerase chain reactions, or PCR, & sequencing, imaging, plate sealing, liquid handling, and sample processing.

Brooks Life Sciences Services Offerings

The principal offerings of the Brooks Life Sciences Services segment include the following:

Genomic Services - provides gene sequencing and gene synthesis services, enabling the fast-expanding research of gene-based healthcare discoveries and therapies.

These service offerings include Next Generation sequencing, or NGS, Sanger sequencing, gene synthesis, bioinformatics, and GLP regulatory services.

The sequencing services are available with both standard and custom services for extraction, library preparation, sequencing, and bioinformatics, supported by Ph.D.-level project managers providing consultations, updates, and post-delivery assistance.

The gene synthesis offerings provide production of a wide range of sequence lengths and structural complexity, DNA cloning, gene fragment synthesis, and oligo synthesis.

Sample Repository Solutions - includes a complete range of services consisting of on-site and off-site sample storage, cold chain logistics, sample transport and collection relocation, bio-processing solutions (inclusive of sample preparation, and genomic and cell culture analysis), disaster recovery and business continuity, as well as project management and consulting.

Informatics - provides sample intelligence software solutions and integration of customer technology.

Our informatics suite supports laboratory work flow scheduling for life science tools and instrument work cells, sample inventory and logistics, environmental and temperature monitoring, clinical trial and consent management, as well as planning, data management, virtualization, and visualization of sample collections.

Our informatics suite supports laboratory workflow scheduling for life science tools and instrument work cells, sample inventory and logistics, environmental and temperature monitoring, clinical trial and consent management, and planning, data management, virtualization, and visualization of sample collections.

The addition of RURO's capabilities and offerings enables us to offer enhanced on-site and off-site management of biological sample inventories and integration solutions to our customers for their increasingly distributed workflow.

Sales, Marketing and Customer Support

We market and sell the majority of our semiconductor products and services in Asia, Europe, the Middle East and North America through our direct sales organization.

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 and that team engages the customer at different levels of its organization to facilitate planning, provide product customization when required, and ensure open communication and support.

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 genomic services, consumables and instruments with distributors that reach a broad range of customers.

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.

The sales process for our larger sample management systems may take 6 to 18 months to complete and it involves a team typically comprised of individuals from sales, marketing, engineering and senior management.

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, delivery of seminars, participation in industry forums, 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 support and communication with our customers.

Brooks Semiconductor Solutions Group segment operates in a variety of market segments of varying breadth with differing competitors and competitive dynamics.

The semiconductor and adjacent technology markets, as well as process equipment manufacturing industries, are highly competitive and characterized by continual changes and technology improvements.

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.

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., and Rorze Corporation.

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.

We cannot guarantee, however, 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 segment, 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 segment, 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, LabCorp and Covance for storage services, as well as BGI, Integrated DNA Technologies, Eurofins and GenScript for genomic services.

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.

Research and Development

Our research and development efforts are focused on developing new products and enhancing the functionality, degree of integration, reliability and performance of our existing products.

Our engineering, marketing, operations and management personnel leverage their close collaborative relationships with their counterparts in customer organizations in an effort to proactively identify market demands that helps us refocus our research and development investment to match our customers’ demands.

With the rapid pace of change that characterizes the markets we serve, it is essential for us to provide high-performance, reliable products in order to maintain our leadership position in both our Brooks Semiconductor Solutions Group and Brooks Life Sciences businesses.

Our research and development expense was $56.4 million, $46.9 million and $39.9 million during fiscal years 2019, 2018 and 2017, respectively.

We invest in research and development initiatives within our Brooks Semiconductor Solutions Group segment to maintain continued leadership positions in the markets we serve.

We launched our newest Vacuum Automation platform, MagnaTran LEAP™, for the advanced technologies related to manufacturing 10 nanometer design rule semiconductor chips.

MagnaTran LEAP is well positioned to deliver clean, accurate and fast wafer transport for the fast-growing Deposition and Etch market.

We have developed and continue to develop automated biological sample storage solutions for operating in ultra-low temperature environments within the Brooks Life Sciences segment.

We have developed the Twin-bank platform, including an expansion of the product range for a smaller, more space-efficient automated storage system marketed under the brands of SampleStore™ SE and BioStore™ SE and introduced the BioStore™ III Cryo automated cryogenic sample management system which offers sample automation, cold chain management and improved security and accessibility while maintaining sample protection within the storage environment.

With the acquisition of GENEWIZ, we acquired and continue to invest in research and development activities related to our processes and technologies to support complex gene reading and writing services.

Our research and development efforts are focused on developing new products and enhancing the functionality, degree of integration, reliability and performance of our existing products and service offerings.

Our engineering, marketing, operations and management personnel leverage their close collaborative relationships with their counterparts in customer organizations to proactively identify market demands that helps us refocus our research and development investment to match our customers’ demands.

With the rapid pace of change that characterizes the markets we serve, it is essential for us to provide high-performance, reliable products in order to maintain our leadership position in our Brooks Semiconductor Solutions Group and Brooks Life Sciences segments.

Within our Brooks Semiconductor Solutions Group we invest in research and development initiatives to maintain our leadership positions in the market we serve as well as to expand our market opportunity.

Our investments in Vacuum Automation and Contamination Control include ramping our intelligent vacuum robot platform, MagnaTran LEAP, with new designs at customers releasing tools for 10 nanometers and below.

In addition, our new PuroMaxx LEAP carrier clean initiative is well positioned to handle the contamination challenges at 5 nanometers and below, while

having modularity to address the emerging need for carrier clean in the memory markets.

As the demand for extreme ultraviolet (EUV) lithography expands, Brooks continues investment in EUV POD cleaning and reticle storage.

Our initiatives with Guardian LEAP for EUV reticle storage will provide new innovation to solve many contamination challenges with EUV reticles.

Within our Life Sciences Products segment, we have developed and continue to develop automated biological sample storage solutions for operating in ultra-low temperature environments.

We have a complete line up of automated storage from -20°C to -190°C.

Our BioStore™ II’s unique design allows controlled temperature storage down to -80°C with the industry’s highest throughput of sample retrieval.

We recently launched the BioStore™ III V that compliments the BioStore™ III Cryo product line and offers improved data management and sample security for vaccines and biologics stored at -80°C.

Within our Life Sciences Services segment, our GENEWIZ business advances research and development activities in gene sequencing, synthesis and related services to meet market demands.

Recently, enabled by newly developed proprietary technologies, GENEWIZ launched a portfolio of new services, targeting analysis of adeno-associated virus, a common vector used in cell and gene therapy.

We will continue to focus on developing processes and technologies that can streamline sample to data workflow.

Manufacturing and Service

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Our manufacturing operations are designed to provide high quality, optimal cost, differentiated products to our customers in short lead times through responsive and flexible processes and sourcing strategies.

We utilize lean manufacturing techniques for a large portion of our manufacturing, including manufacture of assemblies that we have outsourced to competitive regions, including Asia.

We utilize lean manufacturing techniques for a large portion of our manufacturing, including the manufacture of assemblies that we have outsourced to competitive regions, including Asia.

We also believe the continued sourcing of portions of our manufacturing processes in these regions allows us to better serve our customers who have operations in these regions.

We have service and support locations for our products near to our customers to provide rapid response to their service needs.

We have service and support locations near our customers to provide rapid response to their service needs.

Our principal product service and support locations include Chelmsford, Massachusetts;

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and Kiryat-Gat, Israel.

Our Brooks Life Sciences segment provides sample management storage and transportation services in Indianapolis, Indiana;

Our Brooks Life Sciences segments provide sample management storage and transportation services in Indianapolis, Indiana;

Fresno, California;

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Bronx, New York;

Germany, China, and

We have a network of 13 laboratories that provide genomic services, including seven in the United States, three in China, as well as laboratories in Japan, Germany, and the United Kingdom.

Canada, Germany, China, and Singapore.

We have a network of 13 laboratories that provide genomic services, including seven in the United States, three in China, and one each in Japan, Germany, and the United Kingdom.

Patents and Proprietary Rights

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We cannot guarantee that these efforts will meaningfully protect our trade secrets.

As of September 30, 2019, we owned 385 issued U.S.

As of September 30, 2020, we owned approximately 360 issued U.S.

patents, with various corresponding patents issued in foreign jurisdictions.

We also had 95 pending U.S.

patent applications, with foreign counterparts of certain of these applications having been filed or which may be filed at the appropriate time.

We also had approximately 100 pending U.S.

patent applications, with foreign counterparts of some of these applications having been filed or which may be filed at the appropriate time.

Our patents will expire at various dates through 2038.

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Substantially all of this backlog consists of orders scheduled to be delivered within the next 12 months.

Backlog for the Brooks Life Sciences segment offerings totaled $303 million as of September 30, 2019 as compared to approximately $273 million at September 30, 2018.

Backlog for the Brooks Life Sciences segment includes all purchase orders for which customers have scheduled delivery, regardless of the expected delivery date, and consists of orders for products and service agreements.

Backlog for the Brooks Life Sciences Products segment offerings totaled $92 million as of September 30, 2020, as compared to approximately $51 million at September 30, 2019.

Backlog for the Brooks Life Sciences Products segment includes all purchase orders for which customers have scheduled delivery, regardless of the expected delivery date, and consists of orders for products and service agreements.

Backlog for the Brooks Life Sciences Services segment offerings totaled $235 million as of September 30, 2020, as compared to approximately $252 million at September 30, 2019.

Backlog for the Brooks Life Sciences Services segment includes all purchase orders for which customers have scheduled delivery, regardless of the expected delivery date, and consists of orders for products and service agreements.

In addition, it includes estimated revenue for future services related to our BioStorage business for which contracts have been secured.

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We are subject to federal, state, local environmental laws and regulations, and the environmental laws and regulations of the foreign national and local jurisdictions in which we have manufacturing facilities.

We believe we are materially in compliance with all such laws and regulations.

We believe we are in compliance in all material respects with such laws and regulations.

Compliance with foreign, federal, state, and local laws and regulations has not had, and is not expected to have, an adverse effect on our capital expenditures, competitive position, financial condition or results of operations.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business