VEECO INSTRUMENTS INC 10-K

Item 9A. Controls and Procedures ​ Management’s Report on Internal Control over Financial Reporting ​ Our principal executive and financial officers have evaluated and concluded that our disclosure controls and procedures are effective as of December 31, 2023. The disclosure controls and procedures are designed to ensure that the information required to be disclosed in this report filed under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and is accumulated and communicated to our principal executive and financial officers as appropriate to allow timely decisions regarding required disclosure. ​ Our principal executive and financial officers are responsible for establishing and maintaining adequate internal control over financial reporting, which is a process designed and put into effect to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Using the criteria established in the Internal Control — Integrated Framework (2013) published by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”), Management has evaluated, assessed, and concluded that internal control over financial reporting is effective as of December 31, 2023. ​ KPMG LLP, an independent registered public accounting firm, has audited the consolidated financial statements included in this Annual Report on Form 10-K and, as part of their audit, has issued their report, included herein, on the effectiveness of our internal control over financial reporting. ​ Changes in Internal Control over Financial Reporting ​ During the quarter ended December 31, 2023, there were no changes in internal control that have materially affected or are reasonably likely to materially affect internal control over financial reporting. ​ ​ ​ 44 Table of Contents Report of Independent Registered Public Accounting Firm ​ To the Stockholders and Board of Directors Veeco Instruments Inc.: ​ Opinion on Internal Control Over Financial Reporting ​ We have audited Veeco Instruments Inc. and subsidiaries' the (Company) internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. ​ We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule II - valuation and qualifying accounts (collectively, the consolidated financial statements), and our report dated February 16, 2024 expressed an unqualified opinion on those consolidated financial statements. ​ Basis for Opinion ​ The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. ​ We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. ​ Definition and Limitations of Internal Control Over Financial Reporting ​ A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. ​ Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ​ /s/ KPMG LLP ​ Santa Clara, California February 16, 2024 45 Table of Contents Item 9B. Other Information ​ No ne . ​ PART III ​ Item 10. Directors, Executive Officers and Corporate Governance ​ Information required by this Item that will appear under the headings “Governance,” “Executive Officers,” and “Delinquent Section 16(a) Reports” in the definitive proxy statement to be filed with the SEC relating to our 2024 Annual Meeting of Stockholders is incorporated herein by reference. ​ We have adopted a Code of Ethics for Senior Officers (the “Code”) which applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of the Code can be found on our website (www.veeco.com). We intend to disclose on our website the nature of any future amendments to and waivers of the Code that apply to the chief executive officer, principal financial officer, principal accounting officer, or persons performing similar functions. We have also adopted a Code of Conduct which applies to all of our employees, including those listed above, as well as to our directors. A copy of the Code of Conduct can be found on our website (www.veeco.com). The website address above is intended to be an inactive, textual reference only. None of the material on this website is part of this report. ​ Item 11. Executive Compensation ​ Information required by this Item that will appear under the heading “Compensation” in the definitive proxy statement to be filed with the SEC relating to our 2024 Annual Meeting of Stockholders is incorporated herein by reference. ​ Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters ​ Information required by this Item that will appear under the headings “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information” in the definitive proxy statement to be filed with the SEC relating to our 2024 Annual Meeting of Stockholders is incorporated herein by reference. ​ Item 13. Certain Relationships and Related Transactions, and Director Independence ​ Information required by this Item that will appear under the headings “Certain Relationships and Related Transactions” and “Independence of Board” in the definitive proxy statement to be filed with the SEC relating to our 2024 Annual Meeting of Stockholders is incorporated herein by reference. ​ Item 14. Principal Accounting Fees and Services ​ Information required by this Item that will appear under the heading “Independent Auditor Fees and Other Matters” in the definitive proxy statement to be filed with the SEC relating to our 2024 Annual Meeting of Stockholders is incorporated herein by reference. ​ 46 Table of Contents PART IV ​ Item 15. Exhibits, Financial Statement Schedules ​ (a) (1) The Registrant’s financial statements together with a separate table of contents are annexed hereto (2) Financial Statement Schedules are listed in the separate table of contents annexed hereto. (3) Exhibits ​ Unless otherwise indicated, each of the following exhibits has been previously filed with the Securities and Exchange Commission by the Company under File No. 0-16244. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Filed or Exhibit ​ ​ ​ Incorporated by Reference ​ Furnished Number Exhibit Description Form Exhibit Filing Date Herewith 1.1 ​ Conflict Minerals Report of Veeco Instruments Inc. SD 1.01 5/30/2023 ​ ​ 3.1 ​ Amended and Restated Certificate of Incorporation of Veeco dated December 1, 1994, as amended June 2, 1997 and July 25, 1997. ​ 10-Q ​ 3.1 ​ 8/14/1997 ​ ​ 3.2 ​ Amendment to Certificate of Incorporation of Veeco dated May 29, 1998. ​ 10-K ​ 3.2 ​ 3/14/2001 ​ ​ 3.3 ​ Amendment to Certificate of Incorporation of Veeco dated May 5, 2000. ​ 10-Q ​ 3.1 ​ 8/14/2000 ​ ​ 3.4 ​ Amendment to Certificate of Incorporation of Veeco dated May 16, 2002 . ​ 10-Q ​ 3.1 ​ 10/26/2009 ​ ​ 3.5 ​ Amendment to Certificate of Incorporation of Veeco dated May 18, 2010. ​ 10-K ​ 3.8 ​ 2/24/2011 ​ ​ 3.6 ​ Seventh Amended and Restated Bylaws of Veeco effective January 9, 2023. ​ 8-K ​ 3.1 ​ 1/10/2023 ​ ​ 3.7 ​ Certificate of Designation, Preferences, and Rights of Series A Junior Participating Preferred Stock of Veeco dated March 14, 2001. ​ 10-Q ​ 3.1 ​ 5/9/2001 ​ ​ 4.1 ​ Indenture, dated as of January 18, 2017, by and between Veeco Instruments Inc. and U.S. Bank National Association, as Trustee (relating to the 2.70% Convertible Notes due 2023). ​ 8-K ​ 4.1 ​ 1/18/2017 ​ ​ 4.2 ​ First Supplemental Indenture, dated as of January 18, 2017, by and between Veeco Instruments Inc. and U.S. Bank National Association, as Trustee (relating to the 2.70% Convertible Notes due 2023). ​ 8-K ​ 4.2 ​ 1/18/2017 ​ ​ 4.3 ​ Indenture, dated as of May 18, 2020, between Veeco Instruments Inc. and U.S. Bank National Association, as trustee. ​ 8-K ​ 4.1 ​ 5/18/2020 ​ ​ 4.4 ​ Form of 3.75% Convertible Senior Notes due 2027 . ​ 8-K ​ 4.1 ​ 5/18/2020 ​ ​ 4.5 ​ Indenture, dated as of November 17, 2020, between Veeco Instruments Inc. and U.S. Bank National Association, as trustee . ​ 8-K ​ 4.1 ​ 11/17/2020 ​ ​ 4.6 ​ Form of 3.50% Convertible Senior Notes due 2025 . ​ 8-K ​ 4.1 ​ 11/17/2020 ​ ​ 4.7 ​ Indenture, dated as of May 19, 2023, between Veeco Instruments Inc. and U.S. Bank Trust Company, National Association, as trustee. ​ 10-Q ​ 4.1 ​ 8/7/2023 ​ ​ 4.8 ​ Form of 2.875% Convertible Senior Notes due 2029. ​ 10-Q ​ 4.2 ​ 8/7/2023 ​ ​ 47 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Filed or Exhibit ​ ​ ​ Incorporated by Reference ​ Furnished Number Exhibit Description Form Exhibit Filing Date Herewith 4.9 ​ Description of the Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 . ​ 10-K ​ 4.3 ​ 2/21/2020 ​ ​ 10.1 ​ Lease dated February 18, 2021 between Veeco Instruments Inc. and Trimble-Junction Ventures LLC. ​ 8-K ​ 10.1 ​ 2/24/2021 ​ ​ 10.2* ​ Veeco Severance Benefits Policy, effective May 1, 2009. ​ 10-K ​ 10.1 ​ 2/22/2021 ​ ​ 10.3* ​ Veeco Amended and Restated 2010 Stock Incentive Plan, effective May 5, 2016. ​ S-8 ​ 10.1 ​ 6/2/2016 ​ ​ 10.4* ​ Veeco Amended and Restated 2010 Stock Incentive Plan, effective March 3, 2017. ​ 10-Q ​ 10.1 ​ 11/3/2017 ​ ​ 10.5* ​ Veeco Instruments Inc. 2019 Stock Incentive Plan . ​ S-8 ​ 10.1 ​ 5/7/2019 ​ ​ 10.6* ​ Amendment No. 1 to the Veeco Instruments Inc.2019 Stock Incentive Plan. ​ S-8 ​ 4.8 ​ 5/20/2022 ​ ​ 10.7 ​ Ultratech, Inc. 1993 Stock Option/Stock Issuance Plan (as Amended and Restated as of May 31, 2011) ​ S-8 ​ 10.1 ​ 5/26/2017 ​ ​ 10.8 ​ Form of Capped Call Confirmation. ​ 8-K ​ 10.1 ​ 5/18/2020 ​ ​ 10.9 ​ Exchange Agreement . ​ 8-K ​ 10.1 ​ 11/17/2020 ​ ​ 10.10 ​ Note Purchase Agreement, dated as of November 5, 2021, by and between Veeco Instruments Inc. and Lynrock Lake LLP. ​ 8-K ​ 10.1 ​ 11/8/2021 ​ ​ 10.11 ​ Loan and Security Agreement, dated as of December 16, 2021, by and among Veeco Instruments Inc., as borrower, the guarantors party thereto, the lenders from time to time party thereto, HSBC Bank USA, National Association, as administrative agent, collateral agent, joint lead arranger, and joint bookrunner, Barclays bank PLC, as joint lead arranger and joint bookrunner, and Santander Bank, N.A. ​ 8-K ​ 10.1 ​ 12/20/2021 ​ ​ 10.12 ​ Guaranty, dated as of December 16, 2021, by the guarantors, identified therin in favor of HSBC Bank USA, National Association, as agent. ​ 8-K ​ 10.2 ​ 12/20/2021 ​ ​ 10.13 ​ First Amendment to Loan and Security Agreement, dated as of May 19, 2023, by and among Veeco Instruments Inc., as borrower, the guarantors party thereto, the lenders from time to time party thereto and HSBC Bank USA, National Association, as administrative agent, collateral agent, joint lead arranger, and joint bookrunner, Barclays Bank PLC, as joint lead arranger and joint bookrunner, and Santander Bank, N.A. ​ 10-Q ​ 10.1 ​ 8/7/2023 ​ ​ 10.14* ​ Form of Notice of Performance Restricted Stock Unit Award and related terms and conditions pursuant to the Veeco 2010 Stock Incentive Plan, effective March 2019 . ​ 10-Q 10.1 5/7/2019 ​ ​ 10.15* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2010 Stock Incentive Plan, effective March 2019 (time-based version A) . ​ 10-Q 10.2 5/7/2019 ​ ​ 48 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Filed or Exhibit ​ ​ ​ Incorporated by Reference ​ Furnished Number Exhibit Description Form Exhibit Filing Date Herewith 10.16* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2010 Stock Incentive Plan, effective March 2019 (time-based version B) . ​ 10-Q 10.3 5/7/2019 ​ ​ 10.17* ​ Form of Notice of Performance Restricted Stock Unit Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2020. ​ 10-K ​ 10.16 ​ 2/22/2021 ​ ​ 10.18* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2020. ​ 10-K ​ 10.17 ​ 2/22/2021 ​ ​ 10.19* ​ Form of Notice of Performance Restricted Stock Unit Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2021. ​ 10-Q ​ 10.1 ​ 5/4/2021 ​ ​ 10.20* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2021 . ​ 10-Q ​ 10.2 ​ 5/4/2021 ​ ​ 10.21* ​ Form of Notice of Performance Restricted Stock Unit Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2022. ​ 10-Q ​ 10.1 ​ 5/9/2022 ​ ​ 10.22* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2022. ​ 10-Q ​ 10.2 ​ 5/9/2022 ​ ​ 10.23* ​ Form of Notice of Performance Restricted Stock Unit Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2023. ​ 10-Q ​ 10.1 ​ 5/8/2023 ​ ​ 10.24* ​ Form of Notice of Restricted Stock Award and related terms and conditions pursuant to the Veeco 2019 Stock Incentive Plan, effective March 2023. ​ 10-Q ​ 10.2 ​ 5/8/2023 ​ ​ 10.25* ​ Veeco 2013 Inducement Stock Incentive Plan, effective September 26, 2013 . ​ 10-Q ​ 10.1 ​ 11/4/2013 ​ ​ 10.26* ​ Veeco Instruments Inc. 2016 Employee Stock Purchase Plan . ​ S-8 ​ 10.9 ​ 6/2/2016 ​ ​ 10.27* ​ First Amendment to Veeco Instruments Inc. 2016 Employee Stock Purchase Plan. ​ S-8 ​ 10.11 ​ 5/7/2019 ​ ​ 10.28* ​ Second Amendment to Veeco Instruments Inc. 2016 Employee Stock Purchase Plan . ​ S-8 ​ 10.1 ​ 5/11/2021 ​ ​ 10.29* ​ Form of Amended and Restated Indemnification Agreement entered into between Veeco and each of its directors and executive officers (August 2017). ​ 10-Q ​ 10.2 ​ 8/3/2017 ​ ​ 10.30* ​ ​ Veeco Amended and Restated Senior Executive Change in Control Policy, effective as of January 1, 2014. ​ 10-K ​ 10.22 ​ 2/28/2014 ​ ​ 10.31* ​ Letter Agreement dated January 30, 2012 between Veeco and Dr. William J. Miller. ​ 10-K ​ 10.30 ​ 2/22/2012 ​ ​ 10.32* ​ Letter Agreement dated August 29, 2018 between Veeco and Dr. William J. Miller. ​ 8-K ​ 10.2 ​ 9/4/2018 ​ ​ 49 Table of Contents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Filed or Exhibit ​ ​ ​ Incorporated by Reference ​ Furnished Number Exhibit Description Form Exhibit Filing Date Herewith 10.33* ​ Amendment dated March 22, 2019 to the Letter Agreement between Veeco and William J. Miller, Ph.D. ​ 10-Q ​ 10.4 ​ 5/7/2019 ​ ​ 10.34* ​ Letter Agreement dated January 21, 2004 between Veeco and John P. Kiernan. ​ 10-K ​ 10.38 ​ 3/12/2004 ​ ​ 10.35* ​ Amendment effective June 9, 2006 to Letter Agreement between Veeco and John P. Kiernan. ​ 10-Q ​ 10.3 ​ 8/4/2006 ​ ​ 10.36* ​ Amendment effective December 31, 2008 to Letter Agreement between Veeco and John P. Kiernan. ​ 10-K ​ 10.40 ​ 3/2/2009 ​ ​ 10.37* ​ Letter dated January 1, 2020 from Veeco to John P. Kiernan. ​ 8-K ​ 99.2 ​ 1/2/2020 ​ ​ 10.38* ​ Letter Agreement dated March 20, 2019 between Veeco and Adrian Devasahayam. ​ 10-K ​ 10.30 ​ 2/22/2021 ​ ​ 10.39* ​ Letter Agreement dated August 4, 2017 between Veeco and Peter Porshnev. ​ 10-K ​ 10.31 ​ 2/22/2021 ​ ​ 10.40* ​ Letter Agreement dated March 9, 2020 between Veeco and Susan Wilkerson. ​ 10-K ​ 10.32 ​ 2/22/2021 ​ ​ 21.1 ​ Subsidiaries of the Registrant. ​ ​ ​ ​ ​ ​ ​ X 23.1 ​ Consent of KPMG LLP. ​ ​ ​ ​ ​ ​ ​ X 31.1 ​ Certification of Chief Executive Officer pursuant to Rule 13a—14(a) or Rule 15d—14(a) of the Securities and Exchange Act of 1934. ​ ​ ​ ​ ​ ​ ​ X 31.2 ​ Certification of Chief Financial Officer pursuant to Rule 13a—14(a) or Rule 15d—14(a) of the Securities and Exchange Act of 1934. ​ ​ ​ ​ ​ ​ ​ X 32.1 ​ Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes - Oxley Act of 2002. ​ ​ ​ ​ ​ ​ ​ X 32.2 ​ Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes - Oxley Act of 2002. ​ ​ ​ ​ ​ ​ ​ X 97 ​ Compensation Recoupment Policy for Executive Officers ​ ​ ​ ​ ​ ​ ​ X 101.INS ​ XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline. XBRL document. ​ ​ ​ ​ ​ ​ ​ ** 101.XSD ​ XBRL Schema. ​ ​ ​ ​ ​ ​ ​ ** 101.PRE ​ XBRL Presentation. ​ ​ ​ ​ ​ ​ ​ ** 101.CAL ​ XBRL Calculation. ​ ​ ​ ​ ​ ​ ​ ** 101.DEF ​ XBRL Definition. ​ ​ ​ ​ ​ ​ ​ ** 101.LAB ​ XBRL Label. ​ ​ ​ ​ ​ ​ ​ ** 104 ​ Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). ​ ​ ​ ​ ​ ​ ​ ** * Indicates a management contract or compensatory plan or arrangement, as required by Item 15(a) (3) of Form 10-K. ** Filed herewith electronically ​ 50 Table of Contents SIGNATURES ​ Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 16, 2024. ​ ​ ​ ​ ​ Veeco Instruments Inc. ​ ​ ​ ​ By: /s/ WILLIAM J. MILLER, Ph.D. ​ ​ William J. Miller, Ph.D. ​ ​ Chief Executive Officer ​ Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated, on February 16, 2024. ​ Signature Title ​ ​ ​ /s/ WILLIAM J. MILLER, Ph.D. ​ Chief Executive Officer and Director William J. Miller, Ph.D. ​ (principal executive officer) ​ ​ ​ /s/ JOHN P. KIERNAN ​ Senior Vice President and Chief Financial Officer John P. Kiernan ​ (principal financial & accounting officer) ​ ​ ​ /s/ RICHARD A. D’AMORE ​ Chairman Richard A. D’Amore ​ ​ ​ ​ ​ /s/ KATHLEEN A. BAYLESS ​ Director Kathleen A. Bayless ​ ​ ​ /s/ SUJEET CHAND, Ph.D. Sujeet Chand, Ph.D. ​ ​ Director ​ ​ ​ /s/ GORDON HUNTER ​ Director Gordon Hunter ​ ​ ​ ​ ​ /s/ KEITH D. JACKSON ​ Director Keith D. Jackson ​ ​ ​ ​ ​ /s/ LENA NICOLAIDES, Ph.D. ​ Director Lena Nicolaides, Ph.D. ​ ​ ​ ​ ​ /s/ MARY JANE RAYMOND ​ Director Mary Jane Raymond ​ ​ ​ ​ ​ /s/ THOMAS ST. DENNIS ​ Director Thomas St. Dennis ​ ​ ​ ​ ​ 51 Table of Contents ​ Veeco Instruments Inc. and Subsidiaries ​ Index to Consolidated Financial Statements and Financial Statement Schedule ​ ​ Page ​ ​ Report of Independent Registered Public Accounting Firm (PCAOB ID 185 ) F-2 Consolidated Balance Sheets at December 31, 2023 and 2022 F-5 Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021 F-6 Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2023, 2022, and 2021 F-7 Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2023, 2022, and 2021 F-8 Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022, and 2021 F-9 Notes to Consolidated Financial Statements F-10 Schedule II—Valuation and Qualifying Accounts S-1 11 ​ ​ F-1 Table of Contents Report of Independent Registered Public Accounting F irm ​ To the Stockholders and Board of Directors Veeco Instruments Inc.: ​ Opinion on the Consolidated Financial Statements ​ We have audited the accompanying consolidated balance sheets of Veeco Instruments Inc. and subsidiaries (the Company) as of December 31, 2023 and December 31, 2022, the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2023, and the related notes and financial statement schedule II - valuation and qualifying accounts (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and December 31, 2022, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2023, in conformity with U.S. generally accepted accounting principles. ​ We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 16, 2024 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. ​ Change in Accounting Principle ​ As discussed in Note 1 to the consolidated financial statements, the Company has changed its method of accounting for the convertible senior notes as of January 1, 2022 due to the adoption of Accounting Standards Update No. 2020-06: Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, using the modified retrospective method. ​ Basis for Opinion ​ These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. ​ We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. ​ Critical Audit Matters ​ The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. ​ ​ F-2 Table of Contents Assessment of the value of excess and obsolete inventory ​ As discussed in Note 1 of the consolidated financial statements, the Company assesses the valuation of its inventories, including materials, work-in-process, and finished goods, each reporting period. Obsolete inventory or inventory in excess of the Company’s estimated usage requirement is written down to its estimated net realizable value if less than cost. Estimates of usage include the Company’s analysis of anticipated demand, possible alternative uses of its inventory, as well as other qualitative factors. As of December 31, 2023, the Company’s inventories totaled $237.6 million. ​ We identified the assessment of the value of excess and obsolete inventory as a critical audit matter. Subjective auditor judgement was required to evaluate the Company’s estimates of anticipated demand, which can be affected by market and economic conditions outside the Company’s control. ​ The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s inventory valuation process. This included controls related to the development of estimates of anticipated demand of inventory. We evaluated current year estimates of anticipated demand used to assess the value of excess and obsolete inventory when they differed significantly from historical sales volumes. For certain inventory items, we compared the prior year estimate of anticipated demand to actual results to assess the Company’s ability to accurately forecast. ​ Acquisition-date fair value of a developed technology intangible asset and contingent consideration in the acquisition of Epiluvac AB ​ As discussed in Note 5 to the consolidated financial statements, on January 31, 2023, the Company acquired Epiluvac AB (Epiluvac) in a business combination for total purchase consideration of $56.4 million, including contingent consideration. In connection with the transaction, the purchase price was allocated to the assets and liabilities assumed by the Company based on their fair values as of the acquisition date, primarily comprised of developed technology with the estimated fair value of $28.0 million. The acquisition date fair value of the contingent consideration was approximately $26.1 million, which includes payments up to $15.0 million based on the timely completion of certain defined milestones tied to strategic targets, and up to $20.0 million based on the percentage of orders received during the defined earn-out period. The Company estimated the fair value of the developed technology based on a discounted cash flow model. The Company estimated the fair value of the contingent consideration by assigning probabilities and discount factors to each of the various defined performance milestones, while using a Monte-Carlo simulation model to determine the most likely outcome for payments to be based on value of orders received. ​ We identified the evaluation of the acquisition-date fair value of developed technology and the acquisition-date fair value of the contingent consideration related to the orders received during the defined earn-out period as a critical audit matter. A higher degree of auditor judgment was required to evaluate the Company’s determination of certain projected revenues used in the fair value of the developed technology and the fair value of the contingent consideration because there was limited observable market information. Additionally, specialized skills and knowledge were required to evaluate the discount rates used to determine in the fair value of the developed technology and the fair value of the contingent consideration. Changes in certain projected revenues and discount rates could have a significant impact on the fair value of the acquired developed technology and the contingent consideration liability. ​ The following are the primary procedures we performed to address the critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s acquisition-date valuation process, including controls over the determination of certain projected revenues and discount rates. We evaluated the Company’s determination of certain projected revenues by (1) inquiring of individuals outside of the accounting function about the underlying assumptions used to determine certain projected revenues and the process used to develop them, (2) comparing the underlying assumptions to relevant industry reports, (3) and comparing the underlying assumptions to relevant competitor investor presentation materials. In addition, we involved valuation professionals with specialized skills and knowledge who assisted in: ​ F-3 Table of Contents ● evaluating the discount rate applied to the developed technology intangible asset by reconciling it to the weighted average cost of capital that was calculated using publicly available market data ​ ● evaluating the discount rate applied to the contingent consideration by comparing it to a discount rate that was independently developed using publicly available market data ​ ● developing a fair value estimate of the contingent consideration using a parallel Monte-Carlo simulation and comparing it to the Company’s estimate. ​ /s/ KPMG LLP ​ We have served as the Company’s auditor since 2015. ​ Santa Clara, California February 16, 2024 ​ F-4 Table of Contents Veeco Instruments Inc. and Subsidiaries Consolidated Balance Sheets (in thousands, except share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2023 2022 Assets ​ ​ ​ ​ ​ Current assets: ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 158,781 ​ $ 154,925 Restricted cash ​ ​ 339 ​ ​ 547 Short-term investments ​ 146,664 ​ 147,488 Accounts receivable, net ​ 103,018 ​ 124,221 Contract assets ​ ​ 24,370 ​ ​ 16,507 Inventories ​ 237,635 ​ 206,908 Prepaid expenses and other current assets ​ ​ 35,471 ​ ​ 18,305 Total current assets ​ 706,278 ​ 668,901 Property, plant, and equipment, net ​ 118,459 ​ 107,281 Operating lease right-of-use assets ​ ​ 24,377 ​ ​ 26,467 Intangible assets, net ​ ​ 43,945 ​ ​ 23,887 Goodwill ​ 214,964 ​ 181,943 Deferred income taxes ​ ​ 117,901 ​ ​ 116,349 Other assets ​ 3,117 ​ 3,355 Total assets ​ $ 1,229,041 ​ $ 1,128,183 ​ ​ ​ ​ ​ ​ ​ Liabilities and stockholders' equity ​ ​ ​ ​ ​ ​ Current liabilities: ​ ​ ​ ​ ​ ​ Accounts payable ​ $ 42,383 ​ $ 52,049 Accrued expenses and other current liabilities ​ 57,624 ​ 56,031 Contract liabilities ​ 118,026 ​ 127,223 Income taxes payable ​ — ​ 2,432 Current portion of long-term debt ​ — ​ 20,169 Total current liabilities ​ 218,033 ​ 257,904 Deferred income taxes ​ 6,552 ​ 1,285 Long-term debt ​ 274,941 ​ 254,491 Long-term operating lease liabilities ​ ​ 31,529 ​ ​ 33,581 Other liabilities ​ 25,544 ​ 3,098 Total liabilities ​ 556,599 ​ 550,359 Stockholders' equity: ​ ​ ​ ​ ​ ​ Preferred stock, $ 0.01 par value; 500,000 shares authorized; no shares issued and outstanding. ​ — ​ ​ — Common stock, $ 0.01 par value; 120,000,000 shares authorized; 56,364,131 shares issued and outstanding at December 31, 2023 and 51,660,409 shares issued and outstanding at December 31, 2022 ​ 564 ​ 517 Additional paid-in capital ​ 1,202,440 ​ 1,078,180 Accumulated deficit ​ ( 532,169 ) ​ ( 501,801 ) Accumulated other comprehensive income ​ 1,607 ​ 928 Total stockholders' equity ​ 672,442 ​ 577,824 Total liabilities and stockholders' equity ​ $ 1,229,041 ​ $ 1,128,183 ​ See accompanying Notes to the Consolidated Financial Statements. ​ F-5 Table of Contents Veeco Instruments Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except per share amounts) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 Net sales ​ ​ $ 666,435 ​ $ 646,137 ​ $ 583,277 Cost of sales ​ ​ 381,376 ​ 382,989 ​ 341,003 Gross profit ​ ​ 285,059 ​ 263,148 ​ 242,274 Operating expenses, net: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Research and development ​ ​ 112,853 ​ 103,565 ​ 88,680 Selling, general, and administrative ​ ​ 92,756 ​ 88,952 ​ 84,536 Amortization of intangible assets ​ ​ 8,481 ​ 10,018 ​ 12,280 Other operating expense (income), net ​ ​ ​ 1,029 ​ ​ 317 ​ ​ 68 Total operating expenses, net ​ ​ ​ 215,119 ​ ​ 202,852 ​ ​ 185,564 Operating income ​ ​ 69,940 ​ 60,296 ​ 56,710 Interest income ​ ​ 10,583 ​ 2,199 ​ 2,340 Interest expense ​ ​ ( 11,770 ) ​ ( 11,510 ) ​ ( 28,360 ) Other income (expense), net ​ ​ ​ ( 97,091 ) ​ ​ — ​ ​ ( 5,010 ) Income (loss) before income taxes ​ ​ ( 28,338 ) ​ 50,985 ​ 25,680 Income tax expense (benefit) ​ ​ 2,030 ​ ( 115,957 ) ​ ( 358 ) Net income (loss) ​ ​ $ ( 30,368 ) ​ $ 166,942 ​ $ 26,038 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income (loss) per common share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ $ ( 0.56 ) ​ $ 3.35 ​ $ 0.53 Diluted ​ ​ $ ( 0.56 ) ​ $ 2.71 ​ $ 0.49 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted average number of shares: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ 53,769 ​ 49,906 ​ 49,073 Diluted ​ ​ 53,769 ​ 65,607 ​ 53,643 ​ See accompanying Notes to the Consolidated Financial Statements. ​ ​ F-6 Table of Contents Veeco Instruments Inc. and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 Net income (loss) ​ ​ $ ( 30,368 ) ​ $ 166,942 ​ $ 26,038 Other comprehensive income (loss), net of tax: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Available-for-sale securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in net unrealized gains or losses ​ ​ 691 ​ ( 514 ) ​ ( 311 ) Unrealized gain (loss) on available-for-sale securities ​ ​ 691 ​ ( 514 ) ​ ​ ( 311 ) Currency translation adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in currency translation adjustments ​ ​ ( 12 ) ​ ( 41 ) ​ ( 52 ) Net changes related to currency translation adjustments ​ ​ ( 12 ) ​ ( 41 ) ​ ( 52 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total other comprehensive income (loss), net of tax ​ ​ 679 ​ ( 555 ) ​ ( 363 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total comprehensive income (loss) ​ ​ $ ( 29,689 ) ​ $ 166,387 ​ $ 25,675 ​ See accompanying Notes to the Consolidated Financial Statements. ​ ​ F-7 Table of Contents Veeco Instruments Inc. and Subsidiaries Consolidated Statements of Stockholders' Equity (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ ​ Additional ​ ​ ​ ​ Other ​ ​ ​ ​ ​ Common Stock ​ Paid-in ​ Accumulated ​ Comprehensive ​ ​ ​ ​ ​ Shares ​ Amount ​ Capital ​ Deficit ​ Income ​ Total Balance at December 31, 2020 49,724 ​ $ 497 ​ $ 1,113,352 ​ $ ( 707,321 ) ​ $ 1,846 ​ $ 408,374 Net income (loss) — ​ — ​ — ​ 26,038 ​ — ​ 26,038 Other comprehensive income (loss), net of tax — ​ — ​ — ​ — ​ ( 363 ) ​ ( 363 ) Share-based compensation expense — ​ ​ — ​ ​ 15,249 ​ — ​ — ​ 15,249 Net issuance under employee stock plans ​ 929 ​ ​ 10 ​ ​ ( 5,600 ) ​ ​ — ​ ​ — ​ ​ ( 5,590 ) Extinguishment of equity component of repurchased/exchanged 2023 Notes ​ — ​ ​ — ​ ​ ( 6,080 ) ​ ​ — ​ ​ — ​ ​ ( 6,080 ) Balance at December 31, 2021 50,653 ​ ​ 507 ​ ​ 1,116,921 ​ ​ ( 681,283 ) ​ ​ 1,483 ​ ​ 437,628 Cumulative effect of change in accounting principle - adoption of ASU 2020-06 ​ — ​ ​ — ​ ​ ( 56,800 ) ​ ​ 12,540 ​ ​ — ​ ​ ( 44,260 ) Net income (loss) — ​ ​ — ​ ​ — ​ ​ 166,942 ​ ​ — ​ 166,942 Other comprehensive income (loss), net of tax — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 555 ) ​ ( 555 ) Share-based compensation expense — ​ ​ — ​ ​ 22,994 ​ ​ — ​ ​ — ​ 22,994 Net issuance under employee stock plans ​ 1,007 ​ ​ 10 ​ ​ ( 4,935 ) ​ ​ — ​ ​ — ​ ​ ( 4,925 ) Balance at December 31, 2022 51,660 ​ ​ 517 ​ ​ 1,078,180 ​ ​ ( 501,801 ) ​ ​ 928 ​ ​ 577,824 Net income (loss) — ​ ​ — ​ ​ — ​ ​ ( 30,368 ) ​ ​ — ​ ( 30,368 ) Other comprehensive income (loss), net of tax — ​ ​ — ​ ​ — ​ ​ — ​ ​ 679 ​ 679 Share-based compensation expense — ​ ​ — ​ ​ 28,558 ​ ​ — ​ ​ — ​ 28,558 Net issuance under employee stock plans ​ 244 ​ ​ 2 ​ ​ ( 6,393 ) ​ ​ — ​ ​ — ​ ​ ( 6,391 ) Partial extinguishment of 2025 and 2027 Notes ​ 4,460 ​ ​ 45 ​ ​ 102,095 ​ ​ ​ ​ ​ ​ ​ ​ 102,140 Balance at December 31, 2023 56,364 ​ $ 564 ​ $ 1,202,440 ​ $ ( 532,169 ) ​ $ 1,607 ​ $ 672,442 ​ See accompanying Notes to the Consolidated Financial Statements. ​ ​ F-8 Table of Contents Veeco Instruments Inc. and Subsidiaries Consolidated Statements of Cash Flows (in thousands) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 Cash Flows from Operating Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ $ ( 30,368 ) ​ $ 166,942 ​ $ 26,038 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 24,966 ​ 25,645 ​ 26,058 Non-cash interest expense ​ ​ 1,118 ​ ​ 962 ​ ​ 13,819 Deferred income taxes ​ ( 2,211 ) ​ ( 118,040 ) ​ ( 651 ) Share-based compensation expense ​ 28,558 ​ 22,994 ​ 15,249 Loss on extinguishment of debt ​ ​ 97,091 ​ ​ — ​ ​ 4,029 Impairment of equity investments ​ ​ — ​ ​ — ​ ​ 980 Provision for bad debts ​ ​ 316 ​ ​ — ​ ​ — Change in contingent consideration ​ ​ 701 ​ ​ — ​ ​ — Changes in operating assets and liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ Accounts receivable and contract assets ​ 13,271 ​ ( 12,826 ) ​ ( 26,664 ) Inventories ​ ( 35,158 ) ​ ( 37,288 ) ​ ( 24,803 ) Prepaid expenses and other current assets ​ ( 16,063 ) ​ 7,668 ​ 7,621 Accounts payable and accrued expenses ​ ( 8,810 ) ​ ( 13,115 ) ​ 20,225 Contract liabilities ​ ( 9,626 ) ​ 64,087 ​ ( 4,099 ) Income taxes receivable and payable, net ​ ( 525 ) ​ 557 ​ 947 Other, net ​ ( 1,586 ) ​ 897 ​ 8,993 Net cash provided by (used in) operating activities ​ 61,674 ​ 108,483 ​ 67,742 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows from Investing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital expenditures ​ ( 27,930 ) ​ ( 24,604 ) ​ ( 40,643 ) Acquisition of businesses, net of cash acquired ​ ​ ( 30,373 ) ​ ​ — ​ ​ — Proceeds from the sale of investments ​ 182,853 ​ 59,738 ​ 330,702 Payments for purchases of investments ​ ( 177,880 ) ​ ( 104,014 ) ​ ( 247,256 ) Proceeds from held for sale assets, net of costs to sell ​ — ​ — ​ 1,725 Net cash provided by (used in) investing activities ​ ​ ( 53,330 ) ​ ​ ( 68,880 ) ​ ​ 44,528 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows from Financing Activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Proceeds from issuance of 2029 Notes, net of issuance costs ​ ​ 223,202 ​ ​ — ​ ​ — Extinguishment of Convertible Notes ​ ​ ( 218,991 ) ​ ​ — ​ ​ ( 115,604 ) Debt issuance costs ​ ​ — ​ ​ — ​ ​ ( 835 ) Contingent consideration payment ​ ​ ( 2,500 ) ​ ​ — ​ ​ — Proceeds (net of tax withholdings) from option exercises and employee stock purchase plan ​ 4,618 ​ 3,698 ​ 3,402 Restricted stock tax withholdings ​ ( 11,009 ) ​ ( 8,248 ) ​ ( 8,992 ) Net cash provided by (used in) financing activities ​ ( 4,680 ) ​ ( 4,550 ) ​ ( 122,029 ) Effect of exchange rate changes on cash and cash equivalents ​ ( 16 ) ​ ( 53 ) ​ ( 52 ) Net increase (decrease) in cash, cash equivalents, and restricted cash ​ 3,648 ​ 35,000 ​ ( 9,811 ) Cash, cash equivalents, and restricted cash - beginning of period ​ 155,472 ​ 120,472 ​ 130,283 Cash, cash equivalents, and restricted cash - end of period ​ $ 159,120 ​ $ 155,472 ​ $ 120,472 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Supplemental Disclosure of Cash Flow Information ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest paid ​ $ 11,781 ​ $ 10,139 ​ $ 12,551 Income taxes paid (refunds received) ​ ​ 5,095 ​ ​ 1,434 ​ ​ ( 139 ) Non-cash activities ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital expenditures included in accounts payable and accrued expenses ​ ​ 4,388 ​ ​ 2,285 ​ ​ 9,096 Net transfer of inventory to property, plant and equipment ​ ​ 4,296 ​ ​ 1,235 ​ ​ ( 63 ) Right-of-use assets obtained in exchange for lease obligations ​ ​ 630 ​ ​ 2,938 ​ ​ 23,777 ​ See accompanying Notes to the Consolidated Financial Statements. ​ F-9 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements ​ Note 1 — Significant Accounting Policies ​ (a) Description of Business ​ Veeco Instruments Inc. (together with its consolidated subsidiaries, “Veeco,” or the “Company”) operates in a single segment: the development, manufacture, sales, and support of semiconductor and thin film process equipment primarily sold to make electronic devices. ​ (b) Basis of Presentation ​ The accompanying audited Consolidated Financial Statements of the Company have been prepared in accordance with United States generally accepted accounting principles (“GAAP”). The Company reports interim quarters on a 13 -week basis ending on the last Sunday of each period, which is determined at the start of each year. The Company’s fourth quarter always ends on the last day of the calendar year, December 31. During 2023 the interim quarters ended on April 2, July 2, and October 1, and during 2022 the interim quarters ended on April 3, July 3, and October 2. The Company reports these interim quarters as March 31, June 30, and September 30 in its interim consolidated financial statements. ​ (c) Use of Estimates ​ The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Although these estimates are based on management’s knowledge of current events and actions it may undertake in the future, these estimates may ultimately differ from actual results. Significant items subject to such estimates and assumptions include: (i) stand-alone selling prices for the Company’s products and services; (ii) allowances for doubtful accounts; (iii) inventory obsolescence; (iv) the useful lives and expected future cash flows of property, plant, and equipment and identifiable intangible assets; (v) the fair value of the Company’s reporting unit and related goodwill; (vi) investment valuations and the valuation of derivatives, deferred tax assets, and assets acquired in business combinations; (vii) the recoverability of long-lived assets; (viii) liabilities for product warranty and legal contingencies; (ix) share-based compensation; (x) lease term and incremental borrowing rates used in determining operating lease assets and liabilities; (xi) income tax uncertainties; (xii) purchase accounting estimates; and (xiii) contingent consideration estimates. ​ (d) Principles of Consolidation ​ The Consolidated Financial Statements include the accounts of the Company and its subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. Companies acquired during each reporting period are reflected in the results of the Company effective from their respective dates of acquisition through the end of the reporting period. ​ (e) Foreign Currencies ​ Assets and liabilities of the Company’s foreign subsidiaries that operate using functional currencies other than the U.S. dollar are translated using the exchange rates in effect at the balance sheet date. Results of operations are translated using monthly average exchange rates. Adjustments arising from the translation of the foreign currency financial statements of the Company’s subsidiaries into U.S. dollars, including intercompany transactions of a long-term nature, are reported as currency translation adjustments in “Accumulated other comprehensive income” in the Consolidated Balance Sheets. Foreign currency transaction gains or losses are included in “Other operating expense (income), net” in the Consolidated Statements of Operations. ​ F-10 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ (f) Revenue Recognition ​ Revenue is recognized upon the transfer of control of the promised product or service to the customer in an amount that reflects the consideration the Company expects to receive in exchange for such product or service. The Company’s contracts with customers generally do not contain variable consideration. In the rare instances where variable consideration is included, the Company estimates the amount of variable consideration and determines what portion of that, if any, has a high probability of significant subsequent revenue reversal, and if so, that amount is excluded from the transaction price. The Company’s contracts with customers frequently contain multiple deliverables, such as systems, upgrades, components, spare parts, installation, maintenance, and service plans. Judgment is required to properly identify the performance obligations within a contract and to determine how the revenue should be allocated among the performance obligations. The Company also evaluates whether multiple transactions with the same customer or related parties should be considered part of a single contract based on an assessment of whether the contracts or agreements are negotiated or executed within a short time frame of each other or if there are indicators that the contracts are negotiated in contemplation of one another. When there are separate units of accounting, the Company allocates revenue to each performance obligation on a relative stand-alone selling price basis. The stand-alone selling prices are determined based on the prices at which the Company separately sells the systems, upgrades, components, spare parts, installation, maintenance, and service plans. For items that are not sold separately, the Company estimates stand-alone selling prices generally using an expected cost plus margin approach. Most of the Company’s revenue is recognized at a point in time when the performance obligation is satisfied. The Company considers many facts when evaluating each of its sales arrangements to determine the timing of revenue recognition, including its contractual obligations and the nature of the customer’s post-delivery acceptance provisions. The Company’s system sales arrangements, including certain upgrades, generally include field acceptance provisions that may include functional or mechanical test procedures. For many of these arrangements, a customer source inspection of the system is performed in the Company’s facility, test data is sent to the customer documenting that the system is functioning to the agreed upon specifications prior to delivery, or other quality assurance testing is performed internally to ensure system functionality prior to shipment. Historically, such source inspection or test data replicates the field acceptance provisions that are performed at the customer’s site prior to final acceptance of the system. When the Company objectively demonstrates that the criteria specified in the contractual acceptance provisions are achieved prior to delivery either through customer testing or the Company’s historical experience of its tools meeting specifications, transfer of control of the product to the customer is considered to have occurred and revenue is recognized upon system delivery since there is no substantive contingency remaining related to the acceptance provisions at that date. For new products, new applications of existing products, or for products with substantive customer acceptance provisions where the Company cannot objectively demonstrate that the criteria specified in the contractual acceptance provisions have been achieved prior to delivery, revenue and the associated costs are deferred. The Company recognizes such revenue and costs upon obtaining objective evidence that the acceptance provisions can be achieved, assuming all other revenue recognition criteria have been met. In certain cases, the Company’s contracts with customers contain a billing retention, which is billed by the Company and payable by the customer when field acceptance provisions are completed. Revenue recognized in advance of the amount that has been billed is recorded as a contract asset on the Consolidated Balance Sheets. The Company recognizes revenue related to maintenance and service contracts over time based upon the respective contract term. Installation revenue is recognized over time as the installation services are performed. The Company recognizes revenue from the sales of components, spare parts, and specified service engagements at a point in time, which is typically consistent with the time of delivery in accordance with the terms of the applicable sales arrangement. F-11 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The Company may receive advanced payments on system transactions. The timing of the transfer of goods or services related to the advanced payments is either at the discretion of the customer or expected to be within one year from the advanced receipt. As such, the Company does not adjust transaction prices for the time value of money. Incremental direct costs incurred related to the acquisition of a customer contract, such as sales commissions, are expensed as incurred since the expected performance period is one year or less. The Company has elected to treat shipping and handling costs, including those costs incurred to move, package, and prepare the Company’s products for shipment and to move the products to a customer’s designated location, as a fulfillment activity, and the Company includes such costs in “Cost of sales” in the Consolidated Statements of Operations as incurred. These costs are generally comprised of payments to third-party shippers. Taxes assessed by governmental authorities that are collected by the Company from a customer are excluded from revenue. ​ (g) Warranty Costs ​ The Company typically provides standard warranty coverage on its systems for one year from the date of final acceptance by providing labor and parts necessary to repair the systems during the warranty period. The Company records the estimated warranty cost when revenue is recognized on the related system. Warranty cost is included in “Cost of sales” in the Consolidated Statements of Operations. The estimated warranty cost is based on the Company’s historical experience with its systems and regional labor costs. The Company calculates the average service hours by region and parts expense per system utilizing actual service records to determine the estimated warranty charge. The Company updates its warranty estimates on a quarterly basis when the actual product performance or field expense differs from original estimates. ​ (h) Research and Development Costs ​ Research and development costs are expensed as incurred and include charges for the development of new technology and the transition of existing technology into new products or services. ​ (i) Advertising Expense ​ The cost of advertising is expensed as incurred and totaled $ 0.4 million, $ 0.3 million, and $ 0.3 million for the years ended December 31, 2023, 2022, and 2021, respectively. ​ (j) Accounting for Share-based Compensation ​ Share-based awards exchanged for employee services are accounted for under the fair value method. Accordingly, share-based compensation cost is measured at the grant date based on the estimated fair value of the award. The expense for awards is recognized over the employee’s requisite service period (generally the vesting period of the award). The Company has elected to treat awards with only service conditions and with graded vesting as one award. Consequently, the total compensation expense is recognized straight-line over the entire vesting period, so long as the compensation cost recognized at any date at least equals the portion of the grant date fair value of the award that is vested at that date. ​ In addition to stock options, restricted share awards (“RSAs”) and restricted stock units (“RSUs”) with time-based vesting, the Company grants performance share units and awards (“PSUs” and “PSAs”) that have either performance or market conditions. Compensation cost for PSUs and PSAs with performance conditions is recognized over the requisite service period based on the timing and expected level of achievement of the performance targets. A change in the assessment of performance attainment prior to the conclusion of the performance period is recognized in the period of the change in estimate. Compensation cost for PSUs and PSAs with market conditions is recognized over the requisite service period regardless of the expected level of achievement. For all PSUs and PSAs, the number of shares issued to the employee at the conclusion of the service period may vary from the original target based upon the level of attainment of the performance or market conditions. F-12 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ ​ The Company uses the Black-Scholes option-pricing model to compute the estimated fair value of option awards and purchase rights under the Employee Stock Purchase Plan. The Company uses a Monte Carlo simulation to compute the estimated fair value of awards with market conditions. The Black-Scholes model and Monte Carlo simulation include assumptions regarding dividend yields, expected volatility, expected option term, and risk-free interest rates. See Note 13, “Stock Plans,” for additional information. ​ (k) Income Taxes ​ Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rate is recognized in income in the period that includes the enactment date. A valuation allowance is provided for deferred tax assets if it is more likely than not that these items will not be realized, which is dependent upon the generation of future taxable income. ​ (l) Concentration of Credit Risk ​ Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, investments, derivative financial instruments used in hedging activities, and accounts receivable. The Company invests in a variety of financial instruments and, by policy, limits the amount of credit exposure with any one financial institution or commercial issuer. Historically, the Company has not experienced any material credit losses on its investments. ​ The Company maintains an allowance reserve for potentially uncollectible accounts for estimated losses resulting from the inability of its customers to make required payments. The Company evaluates its allowance for doubtful accounts based on a combination of factors. In circumstances where specific invoices are deemed to be uncollectible, the Company provides a specific allowance for bad debt against the amount due to reduce the net recognized receivable to the amount reasonably expected to be collected. The Company also provides allowances based on its write-off history. Finally, the Company also considers its current expectations of future economic conditions, when estimating its allowance for doubtful accounts. The allowance for doubtful accounts totaled $ 1.0 million and $ 0.7 million at December 31, 2023 and 2022 respectively. ​ To further mitigate the Company’s exposure to uncollectable accounts, the Company may request certain customers provide a negotiable irrevocable letter of credit drawn on a reputable financial institution. These irrevocable letters of credit are typically issued to mature between zero and 90 days from the date the documentation requirements are met, typically when a system ships or upon receipt of final acceptance from the customer. The Company, at its discretion, may monetize these letters of credit on a non-recourse basis after they become negotiable but before maturity. The fees associated with the monetization are included in “Selling, general, and administrative” in the Consolidated Statements of Operations and were immaterial for the years ended December 31, 2023, 2022, and 2021. ​ (m) Fair Value of Financial Instruments ​ The carrying amounts of financial instruments, including cash equivalents, accounts receivable, accounts payable, and accrued expenses reflected in the consolidated financial statements approximate fair value due to their short-term maturities. The fair value of debt for footnote disclosure purposes, including current maturities, if any, is estimated using recently quoted market prices of the instrument, or if not available, a discounted cash flow analysis based on the estimated current incremental borrowing rates for similar types of instruments. F-13 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ ​ (n) Cash, Cash Equivalents, and Short-term Investments ​ All financial instruments purchased with an original maturity of three months or less at the time of purchase are considered cash equivalents. Such items may include liquid money market funds, certificate of deposit and time deposit accounts, U.S. treasuries, government agency securities, and corporate debt. Investments that are classified as cash equivalents are carried at cost, which approximates fair value. The Company’s cash and cash equivalents includes $ 97.8 million and $ 61.5 million of cash equivalents at December 31, 2023 and 2022, respectively. ​ A portion of the Company’s cash and cash equivalents is held by its subsidiaries throughout the world, frequently in each subsidiary’s respective functional currency, which is typically the U.S. dollar. Approximately 29 % and 18 % of cash and cash equivalents were maintained outside the United States at December 31, 2023 and 2022, respectively. ​ Short-term investments consist of marketable debt securities, and are generally classified as available-for-sale for use in current operations, if required, and are reported at fair value, with unrealized gains and losses, net of tax, presented as a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income” on the Consolidated Balance Sheets. These securities can include U.S. treasuries, government agency securities, corporate debt, and commercial paper, all with maturities of greater than three months when purchased. All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary are included in “Other operating expense (income), net” in the Consolidated Statements of Operations. The specific identification method is used to determine the realized gains and losses on investments. ​ Non-marketable equity securities are equity securities without readily observable market prices and are included in “Other assets” in the Consolidated Balance Sheets. Non-marketable securities are measured at cost, adjusted for changes in observable prices minus impairment. Changes in fair value and impairment charges are included in “Other income (expense), net” in the Consolidated Statements of Operations. ​ (o) Inventories ​ Inventories are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. Each quarter the Company assesses the valuation and recoverability of all inventories: materials (raw materials, spare parts, and service inventory); work-in-process; finished goods; and evaluation inventory at customer facilities. Obsolete inventory or inventory in excess of management’s estimated usage requirement is written down to its estimated net realizable value if less than cost. The Company evaluates usage requirements by analyzing historical usage, anticipated demand, alternative uses of materials, and other qualitative factors. Unanticipated changes in demand for the Company’s products may require a write down of inventory, which would be reflected in cost of sales in the period the revision is made. Inventory acquired as part of a business combination is recorded at fair value on the date of acquisition. ​ (p) Business Combinations ​ The Company allocates the fair value of the purchase consideration of the Company’s acquisitions to the tangible assets, intangible assets, including in-process research and development (“IPR&D”), if any, and liabilities assumed, based on estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Additionally, the Company estimates the fair value of contingent consideration included as part of the purchase price by assigning probabilities and discount factors to each of the various defined performance milestones, while using a Monte-Carlo simulation model to determine the most likely outcome for payments to be based on value of orders received. ​ F-14 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ (q) Goodwill and Indefinite-Lived Intangible Assets ​ Goodwill is an asset representing the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. Goodwill is measured as the excess of the consideration transferred over the net fair value of identifiable assets acquired and liabilities assumed. Intangible assets with indefinite useful lives are measured at their respective fair values on the acquisition date. Intangible assets related to IPR&D projects are considered to be indefinite-lived until the completion or abandonment of the associated research and development (“R&D”) efforts. If and when development is complete, the associated assets would be deemed long-lived and would then be amortized based on their respective estimated useful lives at that point in time. Goodwill and indefinite-lived intangibles are not amortized into results of operations but instead are evaluated for impairment. The Company performs the evaluation in the beginning of the fourth quarter of each year or more frequently if impairment indicators arise. ​ In testing goodwill for impairment, the Company may first perform a qualitative assessment of whether it is more likely than not that the reporting unit’s fair value is less than its carrying amount, and, if so, the Company then quantitatively compares the fair value of the reporting unit to its carrying amount. If the fair value exceeds the carrying amount, goodwill is not impaired. If the carrying amount exceeds fair value, the Company then records an impairment loss equal to the difference, up to the carrying value of goodwill. ​ The Company determines the fair value of its reporting unit based on a reconciliation of the fair value of the reporting unit to the Company’s adjusted market capitalization. The adjusted market capitalization is calculated by multiplying the average share price of the Company’s common stock for the last ten trading days prior to the measurement date by the number of outstanding common shares and adding a control premium. The control premium is estimated using historical transactions in similar industries. ​ In testing indefinite-lived intangible assets for impairment, the Company may first perform a qualitative assessment of whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, and, if so, the Company then quantitatively compares the fair value of the indefinite-lived intangible asset to its carrying amount. The Company determines the fair value of its indefinite-lived intangible assets using a discounted cash flow method. ​ (r) Long-lived Assets ​ Long-lived intangible assets consist of purchased technology, customer relationships, patents, trademarks and tradenames, and backlog and are initially recorded at fair value. Long-lived intangible assets are amortized over their estimated useful lives in a method reflecting the pattern in which the economic benefits are consumed or straight-lined if such pattern cannot be reliably determined. ​ Property, plant, and equipment are recorded at cost. Depreciation expense is calculated based on the estimated useful lives of the assets by using the straight-line method. Amortization of leasehold improvements is recognized using the straight-line method over the shorter of the remaining lease term or the estimated useful lives of the improvements. ​ Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, a recoverability test is performed utilizing undiscounted cash flows expected to be generated by that asset or asset group compared to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, impairment is recognized to the extent the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models or, when available, quoted market values and third-party appraisals. ​ F-15 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ (s) Leases ​ The Company determines at contract inception if an arrangement is a lease, or contains a lease, of an identified asset for which the Company has the right to obtain substantially all of the economic benefits from its use and the right to direct its use. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, while lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at lease commencement date based on the present value of lease payments over the lease term. The implicit discount rate in the Company’s leases generally cannot readily be determined, and therefore the Company uses its incremental borrowing rate based on information available at lease commencement date in determining the present value of future payments. The Company has options to renew or terminate certain leases. These options are included in the determination of lease term when it is reasonably certain that the Company will exercise such options. The Company does not separate lease and non-lease components in determining ROU assets or lease liabilities for real estate leases. Additionally, the Company does not recognize ROU assets or lease liabilities for leases with original terms or renewals of one year or less. ​ (t) Recently Adopted Accounting Standards ​ The Company adopted ASU 2020-06: Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity on January 1, 2022, using the modified retrospective method for all financial instruments that were outstanding as of the adoption date. This standard simplifies the accounting for convertible debt instruments by removing the separation models for convertible debt with a cash conversion feature, as well as convertible instruments with a beneficial conversion feature. As a result, entities will account for a convertible debt instrument wholly as debt, unless certain other conditions are met. The elimination of these models reduces non-cash interest expense for entities that have issued a convertible instrument that was within the scope of those models before the adoption of ASU 2020-06, such as the Company’s 2023 Notes, 2025 Notes, and 2027 Notes. Additionally, ASU 2020-06 requires the application of the if-converted method for calculating diluted earnings per share, and precludes the use of the treasury stock method for certain debt instruments, such as the Company’s 2023 Notes, 2025 Notes, and 2027 Notes. ​ The adoption of ASU 2020-06 resulted in the following adjustments to the Consolidated Balance Sheets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2021 ​ Adoption of ASU 2020-06 ​ January 1, 2022 ​ ​ (in thousands) Balance Sheet line item: ​ ​ ​ ​ ​ ​ ​ ​ ​ Long-term debt ​ $ 229,438 ​ $ 44,260 ​ $ 273,698 Additional paid-in capital ​ ​ 1,116,921 ​ ( 56,800 ) ​ 1,060,121 Accumulated deficit ​ ​ ( 681,283 ) ​ 12,540 ​ ( 668,743 ) ​ (u) Recent Accounting Pronouncements Not Yet Adopted ​ In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” which requires public entities to disclose consistent categories and greater disaggregation of information in the rate reconciliation and for income taxes paid. It also includes certain other amendments to improve the effectiveness of income tax disclosures. The guidance is effective for financial statements issued for annual periods beginning after December 15, 2024, with early adoption permitted. The Company is currently in the process of evaluating the impact of adoption on its consolidated financial statements . ​ The Company is evaluating other pronouncements recently issued but not yet adopted. The adoption of these pronouncements is not expected to have a material impact on our consolidated financial statements. ​ F-16 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Note 2 — Income (Loss) Per Share ​ Basic income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding during the period. Diluted income per share is calculated by dividing net income by the weighted average number of shares used to calculate basic income per share plus the weighted average number of common share equivalents outstanding during the period. The dilutive effect of outstanding options to purchase common stock and non-participating share-based awards is considered in diluted income per share by application of the treasury stock method. The dilutive effect of performance share units is included in diluted income per common share in the periods the performance targets have been achieved, or would have been achieved if the reporting date was the end of the contingency period. Upon the adoption of ASU 2020-06 on January 1, 2022, the Company includes the dilutive effect of shares issuable upon conversion of its Notes in the calculation of diluted income per share using the if-converted method. The Company has the option for the 2025 and 2027 Notes to settle the conversion value in any combination of cash or shares, and as such, the maximum number of shares issuable are included in the dilutive share count if the effect would be dilutive. The Company must settle the principal amount of the 2029 Notes in cash, and has the option to settle any excess of the conversion value over the principal amount in any combination of cash or shares. As such, the Company only includes the excess shares that may be issuable above the principal amount of the 2029 Notes in the dilutive share count, if the effect would be dilutive. Prior to the adoption of ASU 2020-06, based on the Company’s ability and intent to settle the principal amount of its convertible senior notes in cash, and the excess of the principal portion in shares of its common stock, the Company accounted for the conversion spread using the treasury stock method, and the shares issuable upon conversion of the Notes were not included in the calculation of diluted earnings per share except to the extent that the conversion value of the Notes exceeds their principal amount and if the effect would be dilutive. ​ The computations of basic and diluted income (loss) per share for the years ended December 31, 2023, 2022, and 2021 are as follows: ​ F-17 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 ​ ​ ​ (in thousands, except per share amounts) Numerator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income (loss) ​ ​ $ ( 30,368 ) ​ $ 166,942 ​ $ 26,038 Interest expense associated with convertible notes ​ ​ ​ — ​ ​ 10,832 ​ ​ — Net income (loss) available to common shareholders ​ ​ $ ( 30,368 ) ​ $ 177,774 ​ $ 26,038 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Denominator: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic weighted average shares outstanding ​ ​ 53,769 ​ 49,906 ​ 49,073 Effect of potentially dilutive share-based awards ​ ​ — ​ ​ 734 ​ ​ 1,090 Dilutive effect of convertible notes ​ ​ — ​ 14,967 ​ 3,480 Diluted weighted average shares outstanding ​ ​ 53,769 ​ 65,607 ​ 53,643 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income per common share: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ ​ $ ( 0.56 ) ​ $ 3.35 ​ $ 0.53 Diluted ​ ​ $ ( 0.56 ) ​ $ 2.71 ​ $ 0.49 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unvested participating shares excluded from basic weighted average shares outstanding since the securityholders are not obligated to fund losses ​ ​ ​ — ​ ​ — ​ ​ 6 Common share equivalents excluded from the diluted weighted average shares outstanding since the Company incurred a net loss and their effect would be antidilutive ​ ​ ​ 850 ​ ​ — ​ ​ — Potentially dilutive shares excluded from the diluted calculation as their effect would be antidilutive ​ ​ ​ 212 ​ ​ 815 ​ ​ 456 Potential shares to be issued for settlement of the convertible notes excluded from the diluted calculation as their effect would be antidilutive ​ ​ ​ 7,319 ​ ​ — ​ ​ 8,421 ​ ​ Note 3 — Fair Value Measurements ​ Fair value is the price that would be received for an asset or the amount paid to transfer a liability in an orderly transaction between market participants. The Company is required to classify certain assets and liabilities based on the following fair value hierarchy: ​ ● Level 1: Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; ​ ● Level 2: Quoted prices for identical assets and liabilities in markets that are not active, quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; and ​ ● Level 3: Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. ​ A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company has evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. The use of different market assumptions or estimation methodologies could have a significant effect on the estimated fair value amounts. ​ F-18 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The following table presents the Company’s assets that were measured at fair value on a recurring basis at December 31, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Level 1 Level 2 Level 3 Total ​ ​ (in thousands) December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Certificate of deposits and time deposits ​ $ 74,262 ​ $ — ​ $ — ​ $ 74,262 Corporate debt ​ ​ — ​ ​ 1,988 ​ ​ — ​ ​ 1,988 Money market cash ​ ​ 21,587 ​ ​ — ​ ​ — ​ ​ 21,587 Total ​ $ 95,849 ​ $ 1,988 ​ $ — ​ $ 97,837 Short-term investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 59,493 ​ $ — ​ $ — ​ $ 59,493 Government agency securities ​ ​ — ​ ​ 41,818 ​ ​ — ​ ​ 41,818 Corporate debt ​ ​ — ​ ​ 35,409 ​ ​ — ​ ​ 35,409 Commercial paper ​ ​ — ​ ​ 9,944 ​ ​ — ​ ​ 9,944 Total ​ $ 59,493 ​ $ 87,171 ​ $ — ​ $ 146,664 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash equivalents ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Certificate of deposits and time deposits ​ $ 61,135 ​ $ — ​ $ — ​ $ 61,135 Money market cash ​ ​ 405 ​ ​ — ​ ​ — ​ ​ 405 Total ​ $ 61,540 ​ $ — ​ $ — ​ $ 61,540 Short-term investments ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 62,849 ​ $ — ​ $ — ​ $ 62,849 Government agency securities ​ ​ — ​ ​ 27,366 ​ ​ — ​ ​ 27,366 Corporate debt ​ ​ — ​ ​ 41,591 ​ ​ — ​ ​ 41,591 Commercial paper ​ ​ — ​ ​ 15,682 ​ ​ — ​ ​ 15,682 Total ​ $ 62,849 ​ $ 84,639 ​ $ — ​ $ 147,488 ​ The Company’s investments classified as Level 1 are based on quoted prices that are available in active markets, as well as certificates of deposits and time deposits that are classified as Level 1 due to their short-term nature. The Company’s investments classified as Level 2 are valued using observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes, or alternative pricing sources with reasonable levels of price transparency. ​ F-19 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Note 4 — Investments ​ At December 31, 2023 and 2022 the amortized cost and fair value of marketable securities, which are included in “Short-term investments” on the Consolidated Balance Sheets, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross Gross ​ ​ ​ Amortized ​ Unrealized ​ Unrealized ​ Estimated ​ ​ Cost ​ Gains ​ Losses ​ Fair Value ​ ​ (in thousands) December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 59,541 ​ $ 3 ​ $ ( 51 ) ​ $ 59,493 Government agency securities ​ ​ 41,843 ​ ​ 6 ​ ​ ( 31 ) ​ ​ 41,818 Corporate debt ​ ​ 35,447 ​ ​ 9 ​ ​ ( 47 ) ​ ​ 35,409 Commercial paper ​ ​ 9,944 ​ ​ — ​ ​ — ​ ​ 9,944 Total ​ $ 146,775 ​ $ 18 ​ $ ( 129 ) ​ $ 146,664 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 63,331 ​ $ — ​ $ ( 482 ) ​ $ 62,849 Government agency securities ​ ​ 27,464 ​ ​ — ​ ​ ( 98 ) ​ ​ 27,366 Corporate debt ​ 42,006 ​ ​ — ​ ​ ( 415 ) ​ 41,591 Commercial paper ​ ​ 15,682 ​ ​ — ​ ​ — ​ ​ 15,682 Total ​ $ 148,483 ​ $ — ​ $ ( 995 ) ​ $ 147,488 ​ Available-for-sale securities in a loss position at December 31, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Continuous Loss Position ​ Continuous Loss Position ​ ​ for Less than 12 Months ​ for 12 Months or More ​ ​ ​ Gross ​ ​ Gross ​ ​ Estimated ​ Unrealized ​ Estimated ​ Unrealized ​ ​ Fair Value ​ Losses ​ Fair Value ​ Losses ​ ​ ​ (in thousands) December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 43,118 ​ $ ( 50 ) ​ $ — ​ $ — Government agency securities ​ ​ 34,885 ​ ​ ( 31 ) ​ ​ — ​ ​ — Corporate debt ​ 23,262 ​ ( 33 ) ​ 2,618 ​ ( 15 ) Total ​ $ 101,265 ​ $ ( 114 ) ​ $ 2,618 ​ $ ( 15 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. treasuries ​ $ 39,791 ​ $ ( 84 ) ​ $ 23,057 ​ $ ( 398 ) Government agency securities ​ ​ 22,528 ​ ​ ( 86 ) ​ ​ 4,838 ​ ​ ( 12 ) Corporate debt ​ 19,693 ​ ( 138 ) ​ 21,898 ​ ( 277 ) Total ​ $ 82,012 ​ $ ( 308 ) ​ $ 49,793 ​ $ ( 687 ) ​ F-20 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The contractual maturities of securities classified as available-for-sale at December 31, 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ Amortized ​ Estimated ​ ​ Cost ​ Fair Value ​ ​ ​ (in thousands) Due in one year or less ​ $ 132,419 ​ $ 132,330 Due after one year through two years ​ ​ 14,356 ​ 14,334 Total ​ $ 146,775 ​ $ 146,664 ​ Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The realized gains or losses for the years ended December 31, 2023, 2022, and 2021 were immaterial. ​ Other Investments ​ Veeco has an ownership interest of less than 20 % in a non-marketable investment in a separate entity, with a carrying value of $ 2.0 million at December 31, 2023 and 2022. The Company does not exert significant influence over this entity. This equity investment does not have a readily observable market price, and therefore the Company has elected to measure this investment at cost, adjusted for changes in observable market prices minus impairment. The investment is included in “Other assets” on the Consolidated Balance Sheets. The investment is subject to periodic impairment reviews which require judgment. The analyses include assessments of the companies’ financial condition, the business outlooks for their products and technologies, their projected results and cash flows, business valuation indications from recent rounds of financing, the likelihood of obtaining subsequent rounds of financing, and the impact of equity preferences held by Veeco relative to other investors. During the year ended December 31, 2021, the Company identified impairment indicators on the Company’s investment, and recorded a non-cash impairment charge of $ 1.0 million. This impairment charge was included in “Other income (expense), net” in the Consolidated Statement of Operations. ​ ​ Note 5 — Business Combination ​ Epiluvac ​ On January 31, 2023, the Company acquired Epiluvac AB, a privately held manufacturer of chemical vapor deposition (CVD) epitaxy systems that enable silicon carbide (SiC) applications in the electric vehicle market. This acquisition is expected to accelerate penetration into the emerging, high-growth SiC equipment market. The results of Epiluvac’s operations have been included in the consolidated financial statements since the date of acquisition. ​ The acquisition date fair value of the consideration totaled $ 56.4 million, net of cash acquired, which consisted of the following: ​ ​ ​ ​ ​ ​ Acquisition Date ​ ​ (January 31, 2023) ​ ​ (in thousands) Cash paid, net of cash acquired ​ $ 30,373 Contingent consideration ​ ​ 26,055 Acquisition date fair value ​ $ 56,428 ​ F-21 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The purchase agreement included performance milestones that, if achieved, could trigger additional payments to the original selling shareholders. The contingent arrangements include payments up to $ 15.0 million based on the timely completion of certain defined milestones tied to strategic targets, and up to $ 20.0 million based on the percentage of orders received during the defined Earn-out period. The Earn-out period is four years after the closing date of the acquisition, or earlier if certain conditions are met. ​ The Company estimated the fair value of the contingent consideration by assigning probabilities and discount factors to each of the various defined performance milestones, while using a Monte-Carlo simulation model to determine the most likely outcome for payments to be based on value of orders received. These fair value measurements are based on significant inputs not observable in the market and thus represent a Level 3 measurement as defined in ASC 820. The discount rate used was 5.54 % for the strategic target and order value related contingent payments. The rate was determined based on the nature of the milestone, the risks and uncertainties involved and the time period until the milestone was measured. The determination of the various probabilities and discount factors is highly subjective, requires significant judgment and is influenced by a number of factors, including the adoption of SiC technology. The aggregate fair value of the contingent consideration arrangement at the acquisition date was $ 26.1 million. While the use of SiC is expected to grow in the near future, it is difficult to predict the rate at which SiC will be adopted by the market and thus would impact the sales of our equipment. ​ The Company updates its estimate of fair value of the contingent consideration each reporting period, utilizing the same methodologies described above. During the year ended December 31, 2023, the Company recognized approximately $ 0.7 million of additional contingent consideration, included within “Other operating expense (income) net” in the Consolidated Statement of Operations. Additionally, during the year ended December 31, 2023, the Company paid $ 2.5 million to the selling shareholders in recognition of a performance milestone having been successfully completed. Total contingent consideration liability as of December 31, 2023 was $ 24.2 million, of which $ 1.8 million was included in “Accrued expenses and other current liabilities” and $ 22.4 million was included within “Other liabilities” on the Consolidated Balance Sheet. ​ The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date: ​ ​ ​ ​ ​ ​ Acquisition Date ​ ​ (January 31, 2023) ​ ​ (in thousands) Accounts receivable ​ $ 247 Inventories ​ 391 Prepaid expense and other current assets ​ 381 Property, plant, and equipment ​ 736 Intangible assets ​ ​ 28,540 Total identifiable assets acquired ​ 30,295 ​ ​ ​ ​ Accounts payable and accrued expenses ​ ​ 656 Contract liabilities ​ ​ 429 Deferred income taxes ​ ​ 5,723 Other liabilities ​ ​ 80 Total liabilities assumed ​ 6,888 ​ ​ ​ ​ Net identifiable assets acquired ​ 23,407 Goodwill ​ 33,021 Net assets acquired ​ $ 56,428 ​ F-22 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The gross contractual value of the acquired accounts receivable is the amount expected to be collected by the Company, and therefore is also considered its fair value. Goodwill generated from the acquisition is primarily attributed to expected synergies from future growth and strategic advantages provided through the expansion of product offerings as well as assembled workforce and is not expected to be deductible for income tax purposes. ​ The classes of intangible assets acquired, and the estimated useful life of each class is presented in the table below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Acquisition Date ​ ​ (January 31, 2023) ​ Amount Useful life ​ ​ (in thousands) ​ ​ ​ Technology ​ $ 28,020 15 years Customer relationships ​ 460 5 years Backlog ​ ​ 60 ​ 1.5 years Intangible assets acquired ​ $ 28,540 ​ ​ ​ ​ The Company determined the estimated fair value of the identifiable intangible assets based on various factors including cost, discounted cash flow, income method, loss-of-revenue/income method, and relief-from-royalty method in determining the purchase price allocation. ​ For the year ended December 31, 2023, the Company incurred approximately $ 1.1 million of acquisition related costs, included within “Selling, general, and administrative” in the Consolidated Statement of Operations. Epiluvac’s results of operations were immaterial to the Company’s Consolidated Statement of Operations for the year ended December 31, 2023. Additionally, the pro forma Consolidated Statement of Operations as if Epiluvac had been acquired as of January 1, 2022 would not be materially different from the Company’s actual Consolidated Statement of Operations for the year ended December 31, 2023 or 2022. ​ Note 6 — Inventories ​ Inventories are stated at the lower of cost or net realizable value, with cost determined on a first-in, first-out basis. Inventories consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2023 2022 ​ ​ (in thousands) Materials ​ $ 139,884 ​ $ 134,940 Work-in-process ​ 71,278 ​ 68,765 Finished goods ​ 6,183 ​ 1,513 Evaluation inventory ​ ​ 20,290 ​ ​ 1,690 Total ​ $ 237,635 ​ $ 206,908 ​ ​ F-23 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Note 7 — Property, Plant, and Equipment ​ Property, plant, and equipment, net, consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ ​ 2023 2022 Average Useful Life ​ ​ (in thousands) ​ Land ​ $ 5,061 ​ $ 5,061 N/A Building and improvements ​ 61,679 ​ 64,198 10 – 40 years Machinery and equipment (1) ​ 181,180 ​ 155,533 3 – 10 years Leasehold improvements ​ 52,913 ​ 54,764 3 – 17 years Gross property, plant, and equipment ​ 300,833 ​ 279,556 ​ Less: accumulated depreciation and amortization ​ 182,374 ​ 172,275 ​ Net property, plant, and equipment ​ $ 118,459 ​ $ 107,281 ​ (1) Machinery and equipment also includes software, furniture, and fixtures ​ Depreciation expense was $ 16.5 million, $ 15.6 million, and $ 13.8 million for the years ended December 31, 2023, 2022, and 2021, respectively. ​ Note 8 — Goodwill and Intangible Assets ​ Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. The following table presents the changes in goodwill balances for the year ending December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross carrying Accumulated ​ ​ ​ amount ​ impairment ​ Net amount ​ (in thousands) Balance at December 31, 2022 ​ $ 430,331 ​ $ 248,388 ​ $ 181,943 Acquisition ​ ​ 33,021 ​ ​ — ​ ​ 33,021 Balance at December 31, 2023 ​ $ 463,352 ​ $ 248,388 ​ $ 214,964 ​ The Company performs its annual goodwill impairment test at the beginning of the fourth quarter each year. As the Company maintains a single goodwill reporting unit, it determines the fair value of its reporting unit based upon the Company’s adjusted market capitalization. The annual test performed at the beginning of the fourth quarter of fiscal 2023, 2022, and 2021 did not result in any potential impairment as the fair value of the reporting unit was determined to exceed the carrying amount of the reporting unit. ​ The valuation of goodwill will continue to be subject to changes in the Company’s market capitalization and observable market control premiums. This analysis is sensitive to changes in the Company’s stock price and absent other qualitative factors, the Company may be required to record goodwill impairment charges in future periods if the stock price declines and remains depressed for an extended period of time. ​ F-24 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The components of purchased intangible assets were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ December 31, 2022 ​ ​ Average ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ Remaining Gross Amortization ​ Gross Amortization ​ ​ ​ Amortization ​ Carrying ​ and ​ Net ​ Carrying ​ and ​ Net ​ ​ Period ​ Amount ​ Impairment ​ Amount ​ Amount ​ Impairment ​ Amount ​ ​ (in years) ​ (in thousands) Technology ​ 11.9 ​ $ 355,928 ​ $ 321,923 ​ $ 34,005 ​ $ 327,908 ​ $ 316,918 ​ $ 10,990 Customer relationships ​ 5.3 ​ ​ 146,925 ​ ​ 137,649 ​ ​ 9,276 ​ ​ 146,465 ​ ​ 135,415 ​ ​ 11,050 Trademarks and tradenames ​ 0.6 ​ ​ 30,910 ​ ​ 30,269 ​ ​ 641 ​ ​ 30,910 ​ ​ 29,063 ​ ​ 1,847 Other ​ 0.6 ​ 3,746 ​ 3,723 ​ 23 ​ 3,686 ​ 3,686 ​ — Total ​ 10.3 ​ $ 537,509 ​ $ 493,564 ​ $ 43,945 ​ $ 508,969 ​ $ 485,082 ​ $ 23,887 ​ Other intangible assets primarily consist of patents, licenses, and backlog. ​ Based on the intangible assets recorded at December 31, 2023, and assuming no subsequent additions to or impairment of the underlying assets, the remaining estimated annual amortization expense, is expected to be as follows: ​ ​ ​ ​ ​ ​ ​ Amortization ​ (in thousands) 2024 ​ $ 6,983 2025 ​ 5,394 2026 ​ 4,517 2027 ​ 4,010 2028 ​ 4,050 Thereafter ​ ​ 18,991 Total ​ $ 43,945 ​ ​ Note 9 — Accrued Expenses and Other Liabilities ​ The components of accrued expenses and other current liabilities were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ December 31, ​ 2023 2022 ​ ​ (in thousands) Payroll and related benefits ​ $ 28,321 ​ $ 30,044 Warranty ​ ​ 8,864 ​ ​ 8,601 Operating lease liabilities ​ ​ 4,025 ​ ​ 3,333 Interest ​ ​ 1,149 ​ ​ 2,853 Professional fees ​ ​ 1,834 ​ ​ 2,102 Sales, use, and other taxes ​ 1,825 ​ 2,027 Contingent consideration ​ ​ 1,814 ​ ​ — Other ​ 9,792 ​ 7,071 Total ​ $ 57,624 ​ $ 56,031 ​ Contract Liabilities and Performance Obligations ​ Contract liabilities consist of unsatisfied performance obligations related to advanced payments received and billing in excess of revenue recognized. The contract liability balance as of December 31, 2022 was approximately $ 127.2 million, of which the Company recognized approximately $ 78.4 million into revenue during the year ended December 31, 2023. ​ F-25 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ This reduction in contract liabilities was offset by new billings for products and services which were unsatisfied performance obligations to customers and revenue had not yet been recognized as of December 31, 2023. ​ As of December 31, 2023, the Company has approximately $ 195.1 million of remaining performance obligations on contracts with an original estimated duration of one year or more, of which approximately 92 % is expected to be recognized within one year , with the remaining amounts expected to be recognized between one to three years . The Company has elected to exclude disclosures regarding remaining performance obligations that have an original expected duration of one year or less. ​ Other liabilities ​ Other Liabilities at December 31, 2023 was approximately $ 25.5 million, which included contingent consideration of $ 22.4 million. Additionally, at December 31, 2023 and 2022, other liabilities included medical and dental benefits for former executives of $ 1.9 million and $ 2.0 million, respectively; and asset retirement obligations of $ 0.9 million and $ 0.7 million, respectively. ​ Note 10 — Commitments and Contingencies ​ Warranty ​ Changes in the Company’s product warranty reserves were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 2021 ​ ​ ​ (in thousands) Balance - beginning of the year ​ $ 8,601 ​ $ 7,878 ​ $ 5,058 Warranties issued ​ 6,479 ​ 8,304 ​ 7,102 Addition from Epiluvac acquisition ​ ​ 49 ​ ​ — ​ ​ — Consumption of reserves ​ ( 7,029 ) ​ ( 7,527 ) ​ ( 5,784 ) Changes in estimate ​ 764 ​ ( 54 ) ​ 1,502 Balance - end of the year ​ $ 8,864 ​ $ 8,601 ​ $ 7,878 ​ Minimum Lease Commitments ​ The Company’s operating leases primarily include real estate leases for properties used for manufacturing, R&D activities, sales and service, and administration, as well as certain equipment leases. Some leases may include options to renew for a period of up to 5 years , while others may include options to terminate the lease. The weighted average remaining lease term of the Company’s operating leases as of December 31, 2023 was 11 years , and the weighted average discount rate used in determining the present value of future lease payments was 5.6 % . ​ F-26 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ The following table provides the maturities of lease liabilities at December 31, 2023: ​ ​ ​ ​ ​ ​ ​ Operating ​ Leases ​ ​ (in thousands) Payments due by period: ​ ​ ​ 2024 ​ $ 3,692 2025 ​ ​ 4,130 2026 ​ ​ 4,087 2027 ​ ​ 3,639 2028 ​ ​ 3,422 Thereafter ​ ​ 30,824 Total future minimum lease payments ​ ​ 49,794 Less: Imputed interest ​ ​ ( 14,240 ) Total ​ $ 35,554 ​ ​ ​ ​ Reported as of December 31, 2023 ​ ​ ​ Accrued expenses and other current liabilities ​ $ 4,025 Long-term operating lease liabilities ​ ​ 31,529 Total ​ $ 35,554 ​ Operating lease cost for the years ended December 31, 2023, 2022, and 2021 was $ 5.0 million, $ 7.4 million, and $ 6.6 million, respectively. Variable lease expense, which includes costs not included in the operating lease costs, for the years ended December 31, 2023, 2022, and 2021 was $ 1.1 million, $ 2.0 million, and $ 1.7 million, respectively. Additionally, the Company has an immaterial amount of short-term leases. Lease expense, which includes operating lease costs and variable lease costs, was $ 6.1 million, $ 9.4 million, and $ 8.4 million for the years ended December 31, 2023, 2022, and 2021, respectively. In addition, the Company is obligated under such leases for certain other expenses, including real estate taxes and insurance. Operating cash outflows from operating leases for the year ended December 31, 2023, 2022, and 2021 were $ 5.8 million, $ 7.5 million, and $ 6.6 million (excluding landlord reimbursements for leasehold improvements of $ 6.1 million in 2021 included within “Other, net” in the Consolidated Statements of Cash Flows), respectively. ​ Legal Proceedings ​ The Company is involved in various legal proceedings arising in the normal course of business. The Company does not believe that the ultimate resolution of these matters will have a material adverse effect on its consolidated financial position, results of operations, or cash flows. ​ Concentrations of Credit Risk ​ The Company depends on purchases from its ten largest customers, which accounted for 65 % and 63 % of net accounts receivable at December 31, 2023 and 2022, respectively. ​ F-27 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Customers who accounted for more than 10% of net accounts receivable or net sales are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accounts Receivable ​ Net Sales ​ ​ December 31, ​ For the Year Ended December 31, Customer 2023 2022 2023 2022 2021 Customer A ​ * ​ * ​ 10 % * ​ * ​ Customer B ​ 10 % * ​ * ​ * ​ 10 % Customer C ​ 11 % * ​ * ​ * ​ * ​ Customer D ​ * ​ 10 % * ​ * ​ * ​ Customer E * ​ * ​ * ​ * ​ 15 % * Less than 10% of aggregate accounts receivable or net sales ​ The Company manufactures and sells its products to companies in different geographic locations. Refer to Note 16, “Segment Reporting and Geographic Information,” for additional information. In certain instances, the Company requires deposits from its customers for a portion of the sales price in advance of shipment and performs periodic credit evaluations on its customers. Where appropriate, the Company requires letters of credit on certain non-U.S. sales arrangements. Receivables generally are due within 30 to 90 days from the date of invoice. In some geographies, receivables may be payable up to 150 days from the date of the invoice. ​ Receivable Purchase Agreement ​ The Company entered into a receivable purchase agreement with a financial institution to sell certain of its trade receivables from customers without recourse, up to $ 30.0 million at any point in time. Pursuant to this agreement, the Company sold $ 32.7 million of receivables during the year ended December 31, 2023, of which $ 19.9 million remained outstanding as of December 31, 2023 as defined in the receivable purchase agreement, and $ 10.1 million was available under the agreement for additional sales of receivables. The Company sold $ 13.2 million of receivables during the year ended December 31, 2022. The net sale of accounts receivable under the agreement is reflected as a reduction of accounts receivable in the Company’s Consolidated Balance Sheet at the time of sale and any fees for the sale of trade receivables were not material for the periods presented. ​ Suppliers ​ The Company outsources certain functions to third parties, including the manufacture of several of its systems. While the Company relies on its outsourcing partners to perform their contracted functions, the Company maintains some level of internal manufacturing capability for these systems. In addition, certain of the components and sub-assemblies included in the Company’s products are obtained from a single source or a limited group of suppliers. The failure of the Company’s present outsourcing partners and suppliers to meet their contractual obligations and the Company’s inability to make alternative arrangements or resume the manufacture of these systems could have a material adverse effect on the Company’s revenues, profitability, cash flows, and relationships with its customers. ​ The Company had deposits with its suppliers of $ 19.4 million and $ 9.4 million at December 31, 2023 and 2022, respectively, that were included in “Prepaid expenses and other current assets” on the Consolidated Balance Sheets. ​ Purchase Commitments ​ The Company had purchase commitments of $ 200.4 million at December 31, 2023, the majority of which will come due within one year. Purchase commitments are primarily for inventory used in manufacturing products, as well as equipment and project materials used to support research and development activities, and are partially offset by existing deposits with suppliers. ​ F-28 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Bank Guarantees ​ The Company has bank guarantees and letters of credit issued by a financial institution on its behalf as needed. At December 31, 2023, outstanding bank guarantees and letters of credit totaled $ 19.6 million and unused bank guarantees and letters of credit of $ 13.0 million were available to be drawn upon. ​ Note 11 — Debt ​ Convertible Senior Notes ​ 2023 Notes ​ On January 10, 2017, the Company issued $ 345.0 million of 2.70 % convertible senior unsecured notes due 2023 (the “2023 Notes”). The Company received net proceeds, after deducting underwriting discounts and fees and expenses payable by the Company, of approximately $ 335.8 million. The 2023 Notes bear interest at a rate of 2.70 % per year, payable semiannually in arrears on January 15 and July 15 of each year, commencing on July 15, 2017. The 2023 Notes had a maturity date of January 15, 2023, unless earlier purchased by the Company, redeemed, or converted. ​ On May 18, 2020, in connection with the completion of a private offering of $ 125.0 million aggregate principal amount of 3.75 % convertible senior notes due 2027 described below, the Company repurchased and retired approximately $ 88.3 million in aggregate principal amount of its outstanding 2023 Notes, with a carrying amount of $ 78.1 million, for approximately $ 81.2 million of cash. ​ Additionally, on November 11, 2020, the Company entered into a privately negotiated exchange agreement with a holder of its outstanding 2023 Notes, under which the Company agreed to retire $ 125.0 million in aggregate original principal amount of the 2023 Notes, with a carrying amount of $ 113.1 million, in exchange for the issuance of $ 132.5 million in aggregate principal amount of new 3.50 % convertible senior notes due 2025 described below, which had a fair value that approximated the principal amount of notes issued. ​ Finally, on November 5, 2021, the Company entered into a privately negotiated note purchase agreement with a holder of its outstanding 2023 Notes, under which the Company agreed to repurchase and retire approximately $ 111.5 million in aggregate original principal amount of the 2023 Notes, with a carrying amount of $ 105.5 million, for cash consideration of approximately $ 115.6 million, and approximately $ 1.0 million of accrued and unpaid interest. The Company accounted for the partial settlement of the 2023 Notes as an extinguishment, and as such, recorded a loss on extinguishment of approximately $ 4.0 million for the year ended December 31, 2021, which is included in “Other income (expense), net” in the Consolidated Statements of Operations, as well as a reduction of additional paid-in capital of $ 6.1 million for the repurchase of the conversion feature. ​ The 2023 notes that remained outstanding matured on January 15, 2023 and were paid in cash and settled by the Company at that time. ​ 2025 Notes ​ On November 17, 2020, as part of the privately negotiated exchange agreement described above, the Company issued $ 132.5 million of 3.50 % convertible senior notes due 2025 (the “2025 Notes”). The 2025 Notes bear interest at a rate of 3.50 % per year, payable semiannually in arrears on January 15 and July 15 of each year, commencing on July 15, 2021. The 2025 Notes mature on January 15, 2025, unless earlier purchased by the Company, redeemed, or converted. ​ F-29 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ On May 19, 2023, in connection with the completion of a private offering of $ 230.0 million aggregate principal amount of 2.875 % convertible senior notes due 2029 described below, the Company repurchased and retired approximately $ 106.0 million in aggregate principal amount of its outstanding 2025 Notes, with a carrying amount of $ 105.4 million, for approximately $ 106.0 million of cash and 0.7 million shares of the Company’s common stock. The Company accounted for the partial settlement of the 2025 Notes as an extinguishment, and as such, recorded a loss on extinguishment of approximately $ 16.5 million for the year ended December 31, 2023, which is included in “Other income (expense), net” in the Consolidated Statements of Operations. ​ 2027 Notes ​ On May 18, 2020, the Company completed a private offering of $ 125.0 million of 3.75 % convertible senior notes due 2027 (the “2027 Notes”). The Company received net proceeds of approximately $ 121.9 million, after deducting underwriting discounts and fees and expenses payable by the Company. Additionally, the Company used approximately $ 10.3 million of cash to purchase capped calls, discussed below. The 2027 Notes bear interest at a rate of 3.75 % per year, payable semiannually in arrears on June 1 and December 1 of each year, commencing on December 1, 2020. The 2027 Notes mature on June 1, 2027, unless earlier purchased by the Company, redeemed, or converted. ​ On May 19, 2023, in connection with the completion of a private offering of $ 230.0 million aggregate principal amount of 2.875 % convertible senior notes due 2029 described below, the Company repurchased and retired approximately $ 100.0 million in aggregate principal amount of its outstanding 2027 Notes, with a carrying amount of $ 98.5 million, for approximately $ 92.8 million of cash and 3.8 million shares of the Company’s common stock. The Company accounted for the partial settlement of the 2027 Notes as an extinguishment, and as such, recorded a loss on extinguishment of approximately $ 80.6 million for the year ended December 31, 2023, which is included in “Other income (expense), net” in the Consolidated Statements of Operations. ​ 2029 Notes ​ On May 19, 2023, the Company completed a private offering of $ 230.0 million of 2.875 % convertible senior notes due 2029 (the “2029 Notes”). The Company received net proceeds of approximately $ 223.2 million, after deducting underwriting discounts and fees and expenses payable by the Company. Additionally, the Company used approximately $ 198.8 million of net proceeds from the offering to fund the cash portion of the 2025 Notes and 2027 Notes extinguishments described above and retained the remainder for general corporate purposes. The 2029 Notes bear interest at a rate of 2.875 % per year, payable semiannually in arrears on June 1 and December 1 of each year, commencing on December 1, 2023. The 2029 Notes mature on June 1, 2029, unless earlier purchased by the Company, redeemed, or converted. The Company will settle any conversions of the 2029 Notes by paying cash up to the aggregate principal amount of the 2029 Notes to be converted, and paying or delivering either cash, shares of the Company’s stock, or a combination of cash and shares of common stock at the Company’s election, in respect of the remainder, if any, of the conversion obligation in excess of the aggregate principal amount of the 2029 Notes being converted. ​ The 2025 Notes, 2027 Notes, and 2029 Notes (collectively, the “Notes”) are unsecured obligations of Veeco and rank senior in right of payment to any of Veeco’s subordinated indebtedness; equal in right of payment to all of Veeco’s unsecured indebtedness that is not subordinated; effectively subordinated in right of payment to any of Veeco’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally subordinated to all indebtedness and other liabilities (including trade payables) of Veeco’s subsidiaries. ​ The Notes are convertible at the option of the holders upon the satisfaction of specified conditions and during certain periods as described below. The initial conversion rates are 41.6667 , 71.5372 , and 34.21852 shares of the Company’s common stock per $ 1,000 principal amount of the 2025 Notes, 2027 Notes, and 2029 Notes, respectively, representing initial effective conversion prices of $ 24.00 , $ 13.98 , and $ 29.22 per share of common stock, respectively. The conversion rates may be subject to adjustment upon the occurrence of certain specified events. ​ F-30 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Holders may convert all or any portion of their notes, in multiples of one thousand dollar principal amount, at their option at any time prior to the close of business on the business day immediately preceding October 15, 2024 with respect to the 2025 Notes, October 1, 2026 with respect to the 2027 Notes, and February 1, 2029, with respect to the 2029 Notes, only under the following circumstances: ​ (i) During any calendar quarter (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 % of the conversion price on each applicable trading day; ​ (ii) During the five consecutive business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per one thousand dollar principal amount of Notes for each trading day of the measurement period was less than 98 % of the product of the last reported sale price of Veeco’s common stock and the conversion rate on each such trading day; ​ (iii) If the Company calls any or all of applicable series of the Notes for redemption at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or ​ (iv) Upon the occurrence of specified corporate events. ​ For the calendar quarter ended December 31, 2023, the last reported sales price of common stock during the 30 consecutive trading days, based on the criteria outlined in (i) above, was greater than 130 % of the conversion price of the 2027 Notes, and as such the 2027 Notes are convertible by the holders until March 31, 2024. ​ Holders may convert their notes at any time, regardless of the foregoing circumstances, on or after October 15, 2024 with respect to the 2025 Notes, October 1, 2026 with respect to the 2027 Notes, and February 1, 2029 with respect to the 2029 Notes, until the close of business on the business day immediately preceding the respective maturity date. ​ Accounting for the Notes after the adoption of ASU 2020-06 ​ The Company adopted ASU 2020-06 on January 1, 2022 as further described in Note 1, “Basis of Presentation”. Following the adoption of ASU 2020-06, the Notes are recorded as a single unit within liabilities in the consolidated balance sheets as the conversion features within the Notes are not derivatives that require bifurcation and the Notes do not involve a substantial premium. Transaction costs of $ 9.2 million, $ 1.9 million, $ 3.1 million, and $ 6.8 million incurred in connection with the issuance of the 2023 Notes, 2025 Notes, 2027 Notes, and 2029 Notes, respectively, were recorded as direct deductions from the related debt liabilities and recognized as non-cash interest expense using the effective interest method over the expected terms of the Notes. ​ Accounting for the Notes prior to the adoption of ASU 2020-06 ​ With respect to the 2023 Notes, 2025 Notes, and 2027 Notes, upon conversion by the holders, the Company may elect to settle such conversion in shares of its common stock, cash, or a combination thereof. As a result of its cash conversion options, prior to the adoption of ASU 2020-06, the Company segregated the liability component of the instruments from the equity components. The liability components were measured by estimating the fair value of a non-convertible debt instrument that is similar in its terms to the Notes. The calculation of the fair value of the debt components required the use of Level 3 inputs, including utilization of convertible investors’ credit assumptions and high yield bond indices. Fair value was estimated through discounting future interest and principal payments, an income approach, due under the Notes at a discount rate equal to the estimated borrowing rate for similar non-convertible debt, or 7.0 % , 8.0 % , and 9.1 % with respect to the 2023 Notes, 2025 Notes, and 2027 Notes, respectively. The excess of the aggregate face values of the Notes over the estimated fair values of the liability components of $ 72.5 million, $ 21.0 million, and $ 34.2 million with respect to the 2023 Notes, 2025 Notes, and 2027 Notes, respectively, were recognized as debt discounts and recorded as F-31 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ an increase to additional paid-in capital and were to be amortized over the expected lives of the Notes using the effective interest rate method. Amortization of the debt discounts were recognized as non-cash interest expense. ​ The transaction costs of $ 9.2 million, $ 1.9 million, and $ 3.1 million incurred in connection with the issuance of the 2023 Notes, 2025 Notes, and 2027 Notes, respectively, were allocated to the liability and equity components based on their relative values. Transaction costs allocated to the liability component were being amortized using the effective interest rate method and recognized as non-cash interest expense over the expected terms of the Notes. Transaction costs allocated to the equity component of $ 1.9 million, $ 0.3 million, and $ 0.8 million, for the 2023 Notes, 2025 Notes, and 2027 Notes, respectively, reduced the value of the equity components recognized in stockholders' equity. ​ The carrying values of the Notes are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, 2023 ​ ​ December 31, 2022 ​ ​ Principal Amount ​ Unamortized transaction costs ​ Net carrying value ​ Principal Amount ​ Unamortized debt discount/ transaction costs ​ Net carrying value ​ ​ ​ (in thousands) 2023 Notes ​ $ — ​ $ — ​ $ — ​ $ 20,173 ​ $ ( 4 ) ​ $ 20,169 2025 Notes ​ 26,500 ​ ( 102 ) ​ 26,398 ​ 132,500 ​ ( 990 ) ​ 131,510 2027 Notes ​ ​ 25,000 ​ ​ ( 313 ) ​ ​ 24,687 ​ ​ 125,000 ​ ​ ( 2,019 ) ​ ​ 122,981 2029 Notes ​ ​ 230,000 ​ ​ ( 6,144 ) ​ ​ 223,856 ​ ​ — ​ ​ — ​ ​ — Net carrying value ​ $ 281,500 ​ $ ( 6,559 ) ​ $ 274,941 ​ $ 277,673 ​ $ ( 3,013 ) ​ $ 274,660 ​ Total interest expense related to the Notes is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ ​ 2023 ​ 2022 ​ 2021 ​ ​ (in thousands) Cash Interest Expense ​ ​ ​ ​ ​ ​ ​ Coupon interest expense - 2023 Notes ​ ​ $ 23 ​ $ 545 ​ $ 3,138 Coupon interest expense - 2025 Notes ​ ​ ​ 2,360 ​ ​ 4,637 ​ ​ 4,637 Coupon interest expense - 2027 Notes ​ ​ ​ 2,385 ​ ​ 4,688 ​ ​ 4,688 Coupon interest expense - 2029 Notes ​ ​ ​ 4,078 ​ ​ — ​ ​ — Non-cash Interest Expense ​ ​ ​ ​ ​ ​ ​ Amortization of debt discount/transaction costs- 2023 Notes ​ ​ 4 ​ 97 ​ 4,932 Amortization of debt discount/transaction costs- 2025 Notes ​ ​ ​ 240 ​ ​ 457 ​ ​ 4,795 Amortization of debt discount/transaction costs- 2027 Notes ​ ​ ​ 220 ​ ​ 408 ​ ​ 4,092 Amortization of debt discount/transaction costs- 2029 Notes ​ ​ ​ 654 ​ ​ — ​ ​ — Total Interest Expense ​ ​ $ 9,964 ​ $ 10,832 ​ $ 26,282 ​ The Company determined the 2025 Notes , 2027 Notes , and 2029 Notes are Level 2 liabilities in the fair value hierarchy and had estimated fair values at December 31, 2023 of $ 36.5 million, $ 57.6 million, and $ 298.0 million, respectively. ​ Capped Call Transactions ​ In connection with the offering of the 2027 Notes, on May 13, 2020, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”), pursuant to capped call confirmations, covering the total principal amount of the 2027 Notes for an aggregate premium of $ 10.3 million. The Capped Call Transactions are expected generally to reduce the potential dilution to the Company’s common stock upon any conversion of the 2027 Notes and/or offset any cash payments the Company is required to make in excess of the aggregate principal amount of converted 2027 Notes, as the case may be, with such reduction and/or offset subject to a cap based on the capped price F-32 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ of the Capped Call Transactions. The Capped Call Transactions exercise price is equal to the initial conversion price of the 2027 Notes, and the capped price of the Capped Call Transactions is approximately $ 18.46 per share and is subject to certain adjustments under the terms of the capped call confirmations. ​ The Capped Call Transactions are separate transactions entered into by the Company with the capped call counterparties, are not part of the terms of the 2027 Notes and do not change the holders’ rights under the 2027 Notes. Holders of the 2027 Notes do not have any rights with respect to the Capped Call Transactions. The cost of the Capped Call Transactions is not expected to be tax-deductible as the Company did not elect to integrate the Capped Call Transactions into the 2027 Notes for tax purposes. The Company used a portion of the net proceeds from the offering of the 2027 Notes to pay for the Capped Call Transactions, and the cost of the Capped Call Transactions was recorded as a reduction of the Company’s additional paid-in capital in the accompanying consolidated financial statements. ​ Revolving Credit Facility ​ On December 16, 2021, the Company entered into a loan and security agreement providing for a senior secured revolving credit facility in an aggregate principal amount of $ 150 million (the “Credit Facility”), including a $ 15 million letter of credit sublimit. The Credit Facility is guaranteed by the Company’s direct material U.S. subsidiaries, subject to customary exceptions. Borrowings under the Credit Facility are secured by a first-priority lien on substantially all of the assets of the Company, subject to customary exceptions. The Credit Facility has a term of five years , maturing on December 16, 2026, or earlier if certain liquidity measures are not met prior to the 2025 Notes maturing. Subject to certain conditions and the receipt of commitments from the lenders, the Loan and Security Agreement allows for revolving commitments under the Credit Facility to be increased by up to $ 75 million. The existing lenders under the Credit Facility are entitled, but not obligated, to provide such incremental commitments. ​ Borrowings will bear interest at a floating rate which can be, at the Company’s option, either (a) an alternate base rate plus an applicable rate ranging from 0.50 % to 1.25 % or (b) a SOFR rate (with a floor of 0.00 %) for the specified interest period plus an applicable rate ranging from 1.50 % to 2.25 %, in each case, depending on the Company’s Secured Net Leverage Ratio (as defined in the Loan and Security Agreement). The Company will pay an unused commitment fee ranging from 0.25 % to 0.35 % based on unused capacity under the Credit Facility and the Company’s Secured Net Leverage Ratio. The Company may use the proceeds of borrowings under the Credit Facility to pay transaction fees and expenses, provide for its working capital needs and reimburse drawings under letters of credit and for other general corporate purposes. ​ The Loan and Security Agreement contains customary affirmative covenants for transactions of this type, including, among others, the provision of financial and other information to the administrative agent, notice to the administrative agent upon the occurrence of certain material events, preservation of existence, maintenance of properties and insurance, compliance with laws, including environmental laws, the provision of additional guarantees, and an affiliate transactions covenant, subject to certain exceptions. The Loan and Security Agreement contains customary negative covenants, including, among others, restrictions on the ability to merge and consolidate with other companies, incur indebtedness, refinance our existing convertible notes, grant liens or security interests on assets, make investments, acquisitions, loans, or advances, pay dividends, and sell or otherwise transfer assets. F-33 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ ​ The Loan and Security Agreement contains financial maintenance covenants that require the Borrower to maintain an Interest Coverage Ratio (as defined in the Loan and Security Agreement) of not less than 3.00 to 1.00, a Total Net Leverage Ratio (as defined in the Loan and Security Agreement) of not more than 4.50 to 1.00, and a Secured Net Leverage Ratio (as defined in the Loan and Security Agreement) of not more than 2.50 to 1.00, in each case, tested at the end of each fiscal quarter commencing with the fiscal quarter ending March 31, 2023. The Loan and Security Agreement also provides for a number of customary events of default, including, among others: payment defaults to the lenders; voluntary and involuntary bankruptcy proceedings; covenant defaults; material inaccuracies of representations and warranties; certain change of control events; material money judgments; and other customary events of default. The occurrence of an event of default could result in the acceleration of obligations and the termination of lending commitments under the Loan and Security Agreement. ​ No amounts were outstanding under the Credit Facility as of December 31, 2023 or December 31, 2022. ​ ​ ​ Note 12 — Stockholders’ Equity ​ Accumulated Other Comprehensive Income (“AOCI”) ​ The following table presents the changes in the balances of each component of AOCI, net of tax: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrealized ​ ​ ​ ​ ​ ​ ​ Gains (Losses) ​ ​ ​ ​ ​ Foreign ​ on Available ​ ​ ​ ​ ​ Currency ​ for Sale ​ ​ ​ ​ Translation Securities Total ​ ​ (in thousands) Balance - December 31, 2020 ​ $ 1,866 ​ $ ( 20 ) ​ $ 1,846 Other comprehensive income (loss) ​ ​ ( 52 ) ​ ​ ( 311 ) ​ ​ ( 363 ) Balance - December 31, 2021 ​ ​ 1,814 ​ ​ ( 331 ) ​ ​ 1,483 Other comprehensive income (loss) ​ ​ ( 41 ) ​ ​ ( 514 ) ​ ​ ( 555 ) Balance - December 31, 2022 ​ $ 1,773 ​ $ ( 845 ) ​ $ 928 Other comprehensive income (loss) ​ ( 12 ) ​ 691 ​ 679 Balance - December 31, 2023 ​ $ 1,761 ​ $ ( 154 ) ​ $ 1,607 ​ The Company did not allocate additional tax expense (benefit) to other comprehensive income (loss) for the years ended December 31, 2021, as the Company was in a full valuation allowance position such that a deferred tax asset related to amounts recognized in other comprehensive income was not regarded as realizable on a more-likely-than-not basis. The Company allocated an immaterial amount of additional tax benefit to other comprehensive income (loss) for the year ended December 31, 2022, as the Company is no longer in a full valuation allowance position. The Company allocated an immaterial amount of additional tax expense to other comprehensive income (loss) for the year ended December 31, 2023. ​ Preferred Stock ​ The Board of Directors has authority under the Company’s Certificate of Incorporation to issue shares of preferred stock, par value $ 0.01 , with voting and economic rights to be determined by the Board of Directors. As of December 31, 2023, no preferred shares have been issued. ​ F-34 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Note 13 — Stock Plans ​ Share-based incentive awards are provided to employees under the terms of the Company’s equity incentive compensation plans (the “Plans”), which are administered by the Compensation Committee of the Board of Directors. The 2019 Plan originated as the 2010 Stock Incentive Plan and was originally approved by the Company’s shareholders in May 2010. This Plan was subsequently amended, as approved by shareholders, in 2013, 2016, 2019 (at which time the Plan was renamed the 2019 Stock Incentive Plan), and 2022 (as amended to date, the “2019 Plan”). The Company’s employees, non-employee directors, and consultants are eligible to receive awards under the 2019 Plan, which can include non-qualified stock options, incentive stock options, RSAs, RSUs, PSAs, PSUs, share appreciation rights, dividend equivalent rights, or any combination thereof. ​ The Company is authorized to issue up to 17.8 million shares under the 2019 Plan. Option awards are granted with an exercise price equal to the closing price of the Company’s common stock on the trading day prior to the date of grant; option awards generally vest over a three year period and have a seven or ten year term. RSAs and RSUs generally vest over one to five years . Certain option and share awards provide for accelerated vesting if there is a change in control, as defined in the 2019 Plan. At December 31, 2023, there is an immaterial amount of option shares and 1.7 million RSUs and PSUs outstanding under the 2019 Plan. ​ The Company is authorized to issue up to 2.25 million shares under the approved 2016 employee stock purchase plan (“ESPP”), including additional shares authorized under plan amendments approved by shareholders in 2019 and 2021. Under the ESPP, substantially all employees in the U.S. may purchase the Company’s common stock through payroll deductions at a price equal to 85 percent of the lower of the fair market value of the Company’s common stock at the beginning or end of each six-month offer period, as defined in the ESPP, and subject to certain limits. The ESPP was approved by the Company’s shareholders. ​ Shares Reserved for Future Issuance ​ At December 31, 2023, the Company has 4.5 million shares reserved to cover exercises of outstanding stock options, vesting of RSUs, and additional grants under the 2019 Plan. At December 31, 2023, the Company has 0.4 million shares reserved to cover future issuances under the ESPP Plan. ​ Share-Based Compensation ​ The Company recognized share-based compensation in the following line items in the Consolidated Statements of Operations for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 ​ ​ ​ (in thousands) Cost of sales $ 4,913 $ 4,551 $ 2,373 Research and development ​ ​ ​ 8,994 ​ ​ 6,682 ​ ​ 3,850 Selling, general, and administrative ​ ​ ​ 14,651 ​ ​ 11,761 ​ ​ 9,026 Total ​ ​ $ 28,558 ​ $ 22,994 ​ $ 15,249 ​ The Company did not realize any tax benefits associated with share-based compensation for the year ended December 31, 2021 due to the full valuation allowance on its U.S. deferred tax assets. See Note 15, “Income Taxes” for additional information. The Company recognized a tax benefit of approximately $ 3.9 million and $ 4.5 million associated with share-based compensation for the years ended December 31, 2023 and 2022, respectively. The Company capitalized an immaterial amount of share-based compensation into inventory for the years ended December 31, 2023, 2022, and 2021. ​ F-35 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Unrecognized share-based compensation costs at December 31, 2023 are summarized below: ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized Weighted ​ ​ Share-Based ​ Average Period ​ ​ Compensation ​ Expected to be ​ ​ Costs ​ Recognized ​ ​ (in thousands) (in years) Restricted stock units ​ $ 19,428 ​ 2.1 Restricted stock awards ​ 9,967 ​ 1.2 Performance share units ​ 7,875 ​ 1.8 Total unrecognized share-based compensation cost $ 37,270 ​ 1.8 ​ Stock Option Awards ​ Stock options are awards issued to employees that entitle the holder to purchase shares of the Company’s stock at a fixed price. The following table summarizes the equity activity related to stock options: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ Number of ​ Average ​ Shares Exercise Price ​ ​ (in thousands) ​ ​ ​ Balance - December 31, 2020 ​ 730 ​ $ 35.26 Exercised ​ ( 2 ) ​ 23.36 Expired ​ ( 285 ) ​ ​ 40.16 Balance - December 31, 2021 ​ 443 ​ ​ 32.15 Expired ​ ( 266 ) ​ ​ 32.95 Balance - December 31, 2022 ​ 177 ​ ​ 30.94 Exercised ​ ( 2 ) ​ ​ 30.47 Expired ​ ( 165 ) ​ ​ 30.53 Balance - December 31, 2023 ​ 10 ​ $ 37.42 ​ At December 31, 2023, stock option shares outstanding had a weighted average remaining contractual life of 0.5 years. ​ The following table summarizes information on options exercised for the periods indicated: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2023 2022 2021 ​ ​ (in thousands) Cash received from options exercised ​ $ 56 ​ $ — ​ $ 37 Intrinsic value of options exercised ​ $ 56 ​ $ — ​ $ 6 ​ ​ RSAs, RSUs, PSAs, PSUs ​ RSAs are stock awards issued to employees and directors that are subject to specified restrictions and a risk of forfeiture. RSUs are stock awards issued to employees that entitle the holder to receive shares of common stock as the awards vest. PSAs and PSUs are awards that result in an issuance of shares of common stock to employees if certain performance or market conditions are achieved. All of these awards typically vest over one to four years and vesting is subject to the employee's continued service with the Company and, in the case of performance awards, meeting certain performance or market conditions. The fair value of the awards is determined and fixed based on the closing price of the Company’s common stock on the trading day prior to the date of grant, or, in the case of performance awards with market conditions, fair value is determined using a Monte Carlo simulation. F-36 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ ​ The following table summarizes the equity activity of non-vested restricted shares and performance shares: ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted ​ ​ ​ ​ Average ​ ​ Number of ​ Grant Date ​ ​ Shares ​ Fair Value ​ ​ (in thousands) ​ ​ ​ Balance - December 31, 2020 2,040 ​ $ 12.73 Granted 1,031 ​ ​ 24.26 Performance award adjustments ​ 159 ​ ​ 18.38 Vested ( 1,014 ) ​ ​ 15.50 Forfeited ​ ( 133 ) ​ ​ 15.08 Balance - December 31, 2021 ​ 2,083 ​ ​ 17.33 Granted ​ 1,253 ​ ​ 29.12 Performance award adjustments ​ 85 ​ ​ 14.03 Vested ​ ( 844 ) ​ ​ 15.00 Forfeited ​ ( 81 ) ​ ​ 20.18 Balance - December 31, 2022 ​ 2,496 ​ ​ 23.83 Granted ​ 1,282 ​ ​ 23.83 Performance award adjustments ​ 183 ​ ​ 10.59 Vested ​ ( 1,364 ) ​ ​ 17.47 Forfeited ​ ( 133 ) ​ ​ 29.29 Balance - December 31, 2023 ​ 2,464 ​ $ 26.19 ​ The total fair value of shares that vested during the years ended December 31, 2023, 2022, and 2021 was $ 30.3 million, $ 22.1 million, and $ 22.8 million, respectively. For performance awards, the final number of shares earned will vary depending on the achievement of the actual results relative to the performance or market conditions. Each performance award is included in the table above at the grant date target share amount until the end of the performance period if not previously forfeited. ​ The fair value of performance awards with market conditions is estimated on the date of grant using a Monte Carlo simulation. Estimates of fair value are not intended to predict actual future events or the value ultimately realized by employees who receive these awards. The weighted average fair value and the assumptions used in calculating such values during fiscal years 2023, 2022, and 2021 for performance awards with market conditions were based on estimates at the date of grant as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ ​ 2023 2022 2021 ​ Weighted average fair value ​ $ 32.25 ​ $ 45.28 ​ $ 27.81 ​ Dividend yield ​ ​ 0 % ​ 0 % ​ 0 % Expected volatility factor (1) ​ ​ 54 % ​ 58 % ​ 63 % Risk-free interest rate (2) ​ ​ 3.84 % ​ 2.13 % ​ 0.34 % Expected life (in years) (3) ​ ​ 3.0 ​ 3.0 ​ 3.0 ​ (1) Expected volatility is measured using historical daily price changes of the Company’s stock over the respective expected term. (2) The risk-free rate for periods within the contractual term is based on the U.S. Treasury yield curve in effect at the time of grant. (3) The expected life is the number of years the Company estimates that the awards will be outstanding prior to exercise. ​ F-37 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Employee Stock Purchase Plan ​ For the years ended December 31, 2023, 2022, and 2021 the Company received cash proceeds of $ 4.6 million, $ 3.7 million, and $ 3.4 million, and issued shares of 258,153 , 208,140 , and 196,024 , respectively, under the ESPP Plan. The weighted average estimated values of employee purchase rights as well as the weighted average assumptions that were used in calculating such values during fiscal years 2023, 2022, and 2021 were based on estimates at the date of grant as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ ​ 2023 2022 2021 Weighted average fair value ​ $ 5.77 ​ $ 6.00 ​ $ 5.90 ​ Dividend yield ​ ​ 0 % ​ 0 % ​ 0 % Expected volatility factor (1) ​ ​ 42 % ​ 43 % ​ 52 % Risk-free interest rate (2) ​ ​ 5.03 % ​ 1.73 % ​ 0.07 % Expected life (in years) (3) ​ ​ 0.5 ​ 0.5 ​ 0.5 ​ (1) Expected volatility is measured using historical daily price changes of the Company’s stock over the respective expected term. (2) The risk-free rate for periods within the contractual term is based on the U.S. Treasury yield curve in effect at the time of grant. (3) The expected life is the number of years the Company estimates that the purchase rights will be outstanding prior to exercise. ​ ​ Note 14 — Retirement Plans ​ The Company maintains a defined contribution plan for the benefit of its U.S. employees. The plan is intended to be tax qualified and contains a qualified cash or deferred arrangement as described under Section 401(k) of the Internal Revenue Code. Eligible participants may elect to contribute a percentage of their base compensation, and the Company may make matching contributions, generally equal to fifty cents for every dollar employees contribute, up to three percent of the employee’s eligible compensation, as limited by current Internal Revenue Code regulations. Generally, the plan calls for vesting in the Company contributions over the initial five years of a participant’s employment. The Company provided employer contributions associated with this plan of approximately $ 3.4 million, $ 3.0 million, and $ 2.6 million for the years ended December 31, 2023, 2022, and 2021, respectively. ​ ​ ​ Note 15 — Income Taxes ​ The amounts of income (loss) before income taxes attributable to domestic and foreign operations were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2023 2022 2021 ​ ​ (in thousands) Domestic ​ $ ( 33,383 ) ​ $ 47,368 ​ $ 23,561 Foreign ​ 5,045 ​ 3,617 ​ 2,119 Total ​ $ ( 28,338 ) ​ $ 50,985 ​ $ 25,680 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ F-38 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Significant components of the expense (benefit) for income taxes consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2023 2022 2021 ​ ​ (in thousands) Current: ​ ​ ​ ​ ​ ​ ​ ​ ​ Federal ​ $ 3,299 ​ $ — ​ $ — Foreign ​ 1,136 ​ 1,506 ​ 183 State and local ​ ( 194 ) ​ 577 ​ 110 Total current expense (benefit) for income taxes ​ 4,241 ​ 2,083 ​ 293 Deferred: ​ ​ ​ ​ ​ ​ ​ ​ ​ Federal ​ ( 3,026 ) ​ ( 96,811 ) ​ 119 Foreign ​ 512 ​ ( 484 ) ​ ( 507 ) State and local ​ 303 ​ ( 20,745 ) ​ ( 263 ) Total deferred expense (benefit) for income taxes ​ ( 2,211 ) ​ ( 118,040 ) ​ ( 651 ) Total expense (benefit) for income taxes ​ $ 2,030 ​ $ ( 115,957 ) ​ $ ( 358 ) ​ The income tax expense (benefit) was reconciled to the tax expense computed at the U.S. federal statutory tax rate as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, ​ 2023 2022 2021 ​ ​ (in thousands) Income tax expense (benefit) at U.S. statutory rates ​ $ ( 5,951 ) ​ $ 10,706 ​ $ 5,393 State taxes, net of U.S. federal impact ​ 1,073 ​ 1,101 ​ ( 607 ) Effect of international operations ​ ( 7,668 ) ​ ( 11,149 ) ​ 609 Research and development tax credit ​ ( 7,287 ) ​ ( 6,470 ) ​ ( 3,964 ) Net change in valuation allowance ​ 662 ​ ( 104,972 ) ​ ( 2,389 ) Change in accrual for unrecognized tax benefits ​ ( 369 ) ​ 3,349 ​ 398 Share-based compensation ​ ​ 2,084 ​ ​ 606 ​ ​ 1,208 Extinguishment of debt ​ ​ 19,289 ​ ​ — ​ ​ ( 1,090 ) Adoption of new accounting standard ​ ​ — ​ ​ ( 9,295 ) ​ ​ — Other ​ 197 ​ 167 ​ 84 Total expense (benefit) for income taxes ​ $ 2,030 ​ $ ( 115,957 ) ​ $ ( 358 ) ​ F-39 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Deferred income taxes reflect the effect of temporary differences between the carrying amounts of assets and liabilities recognized for financial reporting purposes and the amounts recognized for tax purposes. The tax effects of the temporary differences were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 ​ ​ (in thousands) Deferred tax assets: ​ ​ ​ ​ ​ ​ Inventory valuation $ 12,682 ​ $ 11,931 Net operating losses ​ ​ 5,841 ​ 5,647 Credit carry forwards ​ ​ 49,086 ​ ​ 59,988 Warranty and installation accruals ​ ​ 1,766 ​ 1,862 Share-based compensation ​ ​ 4,637 ​ 5,267 Contract liabilities ​ ​ 19,785 ​ ​ 24,504 Operating leases ​ ​ 8,034 ​ ​ 8,349 Research and experimental ("R&E") capitalization ​ ​ 34,504 ​ ​ 19,071 Other ​ ​ 4,885 ​ 6,553 Total deferred tax assets ​ ​ 141,220 ​ 143,172 Valuation allowance ​ ​ ( 11,745 ) ​ ( 11,083 ) Net deferred tax assets ​ ​ 129,475 ​ 132,089 ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: ​ ​ ​ ​ ​ ​ Purchased intangible assets ​ ​ 14,166 ​ 8,724 Convertible Senior Notes ​ ​ — ​ ​ ( 39 ) Operating leases ​ ​ 5,548 ​ ​ 5,994 Depreciation ​ ​ ( 1,588 ) ​ 2,346 Total deferred tax liabilities ​ ​ 18,126 ​ 17,025 Net deferred taxes $ 111,349 ​ $ 115,064 ​ The Company does not permanently reinvest its earnings from certain foreign jurisdictions and has accrued for foreign tax withholdings of $ 1.0 million on its unremitted earnings as of December 31, 2023. ​ During the year ended December 31, 2023, income tax expense of $ 2.0 million was primarily comprised of 1) a $ 16.2 million income tax expense on pre-tax income from operations; 2) a $ 2.0 million income tax expense for share based compensation, partially offset by 3) a $ 7.5 million tax benefit related to Foreign-Derived Intangible Income; 4) a $ 7.7 million tax benefit associated with research and development tax credits; and 5) a $ 1.0 million tax benefit associated with the loss on extinguishment of convertible notes under Section 249 of the Internal Revenue Code of 1986, as amended (Section 249). ​ At December 31, 2023, the Company had U.S. federal research and development credits of $ 34.9 million that will expire between 2030 and 2043. Additionally, the Company has state and local NOL carryforwards of approximately $ 56.8 million (a net deferred tax asset of $ 4.0 million, net of federal tax benefits and before the valuation allowance) that will expire between 2024 and 2042. Finally, the Company has state credits of $ 33.6 million, some of which are indefinite and others that will expire between 2024 and 2038. F-40 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ A roll-forward of the Company’s uncertain tax positions for all U.S. federal, state, and foreign tax jurisdictions was as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ 2023 2022 2021 ​ ​ (in thousands) Balance at beginning of year ​ $ 16,110 ​ $ 12,761 ​ $ 12,363 Additions for tax positions related to current year ​ 2,596 ​ 4,180 ​ 2,642 Additions for tax positions related to prior years ​ 83 ​ — ​ 50 Reductions for tax positions related to prior years ​ ( 3,048 ) ​ ( 731 ) ​ ( 1,196 ) Settlements ​ — ​ ( 100 ) ​ ( 1,098 ) Balance at end of year ​ $ 15,741 ​ $ 16,110 ​ $ 12,761 ​ If the amount of unrecognized tax benefits at December 31, 2023 were recognized, the Company’s income tax provision would decrease by $ 13.9 million. The gross amount of interest and penalties accrued in income tax payable in the Consolidated Balance Sheets was approximately $ 0.6 million and $ 0.5 million at December 31, 2023 and 2022, respectively. ​ The Company, or one of its subsidiaries, files income tax returns in the United States federal jurisdiction, and various state, local, and foreign jurisdictions. All material consolidated federal income tax matters have been concluded for years through 2017 subject to subsequent utilization of NOLs generated in such years. All material state and local income tax matters have been reviewed through 2012. The majority of the Company’s foreign jurisdictions have been reviewed through 2015. The Company’s major foreign jurisdictions’ statutes of limitation remain open with respect to the tax years 2016 through 2022 for Germany, 2017 through 2022 for China, 2022 for Taiwan, and 2020 through 2022 for Singapore. The Company does not anticipate that its uncertain tax position will change significantly within the next twelve months subject to the completion of the ongoing tax audits and any resultant settlement. ​ Note 16 — Segment Reporting and Geographic Information ​ The Company operates and measures its results in one operating segment and therefore has one reportable segment: the development, manufacture, sales, and support of semiconductor and thin film process equipment primarily sold to make electronic devices. The Company’s Chief Operating Decision Maker, the Chief Executive Officer, evaluates performance of the Company and makes decisions regarding the allocation of resources based on total Company results. ​ Sales by end-market is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the year ended December 31, ​ 2023 2022 2021 ​ ​ ​ (in thousands) Sales by end-market ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Semiconductor ​ ​ $ 412,724 ​ $ 369,369 ​ $ 247,051 Compound Semiconductor ​ ​ ​ 87,258 ​ ​ 121,194 ​ ​ 106,972 Data Storage ​ ​ 88,473 ​ 87,544 ​ 168,760 Scientific & Other ​ ​ 77,980 ​ 68,030 ​ 60,494 Total ​ ​ $ 666,435 ​ $ 646,137 ​ $ 583,277 ​ The Company’s significant operations outside the United States include sales and service offices in China, Europe, and Rest of APAC. For geographic reporting, sales are attributed to the location in which the customer facility is located. ​ F-41 Table of Contents Veeco Instruments Inc. and Subsidiaries Notes to Consolidated Financial Statements (Continued) ​ Sales and long-lived tangible assets by geographic region are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net Sales to Unaffiliated Customers ​ Long-lived Tangible Assets ​ 2023 2022 2021 2023 2022 2021 ​ ​ (in thousands) United States ​ $ 162,790 ​ $ 197,433 ​ $ 217,209 ​ $ 117,594 ​ $ 106,550 ​ $ 99,220 EMEA (1) ​ 76,697 ​ 87,837 ​ 55,129 ​ 219 ​ 60 ​ 94 China ​ ​ 217,942 ​ ​ 123,703 ​ ​ 105,998 ​ ​ 182 ​ ​ 70 ​ ​ 67 Rest of APAC ​ ​ 208,693 ​ ​ 235,735 ​ ​ 204,633 ​ ​ 464 ​ ​ 601 ​ ​ 362 Rest of World ​ 313 ​ 1,429 ​ 308 ​ — ​ — ​ — Total ​ $ 666,435 ​ $ 646,137 ​ $ 583,277 ​ $ 118,459 ​ $ 107,281 ​ $ 99,743 (1) EMEA consists of Europe, the Middle East, and Africa ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ F-42 Table of Contents ​ ​ ​ ​ Schedule II — Valuation and Qualifying Accounts ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Additions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Charged ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at (Credited) Charged to ​ ​ Balance at ​ ​ Beginning ​ to Costs and ​ Other ​ ​ ​ ​ End of Deducted from asset accounts: ​ of Period ​ Expenses ​ Accounts ​ Deductions ​ Period ​ ​ (in thousands) Year ended December 31, 2023 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for doubtful accounts ​ $ 736 ​ $ 316 ​ $ — ​ $ ( 66 ) ​ $ 986 Valuation allowance in net deferred tax assets ​ 11,083 ​ 662 ​ — ​ — ​ 11,745 ​ ​ $ 11,819 ​ $ 978 ​ $ — ​ $ ( 66 ) ​ $ 12,731 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, 2022 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for doubtful accounts ​ $ 736 ​ $ — ​ $ — ​ $ — ​ $ 736 Valuation allowance in net deferred tax assets ​ 116,054 ​ ( 104,971 ) ​ — ​ ​ ​ 11,083 ​ ​ $ 116,790 ​ $ ( 104,971 ) ​ $ — ​ $ — ​ $ 11,819 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended December 31, 2021 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Allowance for doubtful accounts ​ $ 736 ​ $ — ​ $ — ​ $ — ​ $ 736 Valuation allowance in net deferred tax assets ​ 118,443 ​ — ​ — ​ ( 2,389 ) ​ 116,054 ​ ​ $ 119,179 ​ $ — ​ $ — ​ $ ( 2,389 ) ​ $ 116,790 ​ ​ ​ ​ S-1