One of the key drivers behind Onto Innovation, Inc. ONTO growth and competitive strength has been its strategic use of acquisitions. Rather than relying solely on internal research and development, the company has expanded its technology portfolio through carefully selected acquisitions that enhance its capabilities, accelerate innovation and strengthen its position across multiple semiconductor manufacturing segments.
In April 2026, Onto partnered with Rigaku Holdings Corp. As part of the deal, Onto will buy a 27% ownership stake in Rigaku for approximately $710 million. The transaction is expected to close in the second half of 2026. This partnership provides Onto with access to a broader range of advanced X-ray technologies, which could sharply enhance its semiconductor inspection and metrology capabilities. Along with Onto’s earlier acquisition of Semilab USA, it is growing its process control ecosystem. These investments may help Onto tackle increasingly complex semiconductor manufacturing challenges while creating additional long-term revenue streams. Although it won’t consolidate Rigaku’s financials, Onto expects the partnership to increase earnings through high-margin Ai Diffract software licensing, higher sales of metrology tools like Atlas G6, and annual dividend income of more than $7 million.
Management expects these benefits to cover the lost interest income from the cash used for the deal within a year of closing. In 2025, Onto completed a $495 million acquisition of key Semilab product lines, adding FAaST, CnCV and MBIR tools to strengthen its inline wafer contamination monitoring, materials analysis and surface charge metrology capabilities. Specialty devices and advanced packaging generated approximately $160 million, or 55% of the first-quarter revenues, with advanced packaging contributing roughly two-thirds, including around $25 million from Semilab.
It has added Lumina to enhance its inspection portfolio. Lumina specializes in laser-based inspection for unpatterned wafers and emerging panel applications. Its patented technology enables high-sensitivity scanning of silicon carbide, gallium nitride and glass substrates and carriers in advanced packaging. This complements the company’s pattern inspection capabilities, addresses critical defect detection and is expected to increase SAM by $250 million annually within three years. Onto also acquired its lithography business from Kulicke and Soffa Industries, Inc. in 2024, gaining key intellectual property, including 24 issued patents and eight pending. This acquisition strengthens Onto’s JetStep panel lithography development and enhances its overall metrology and lithography capabilities.
How are ONTO’s Industry Peers Broadening Market Reach?
KLA Corporation's KLAC product roadmap and customer collaboration continue to translate into measurable market share momentum. KLAC has expanded its technology portfolio through strategic acquisitions, including Orbotech in 2019, which strengthened its presence in flat-panel displays, PCBs and advanced packaging; SPTSTechnologies, which added etch and deposition capabilities; Therma-Wave, which enhanced metrology and process control; and ICOSVisionSystems, which bolstered optical inspection solutions for semiconductor packaging. The company also noted that process control share has risen about 360 basis points since 2021, with gains across mask inspection, optical pattern wafer inspection and electron-beam inspection.
Applied Materials AMAT expects its packaging revenues to grow more than 50% in 2026, with investments shifting toward its leadership positions in 3D stacking. This outlook is reinforced by Applied Materials’ intent to acquire NEXX business from ASMPT, which would add panel-level electrochemical deposition capabilities and broaden its portfolio for larger-body AI accelerator packages. Management framed packaging as one of the most enabling parts of AI compute systems, which can extend the duration of packaging investment beyond a single memory build cycle. If the acquisition closes and execution remains on track, AMAT can expand its served markets while deepening customer integration.
ONTO Price Performance, Valuation and Estimates
ONTO’s shares have soared 154.6% in the past year, outperforming the Zacks Nanotechnology industry’s growth of 153.2% as well as the Zacks Computer and Technology sector and the S&P 500 composite’s growth of 43.5% and 26.7%, respectively.
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In terms of forward price/earnings, ONTO’s shares are trading at 31.58X, higher than the industry’s 6.25X.
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The Zacks Consensus Estimate for ONTO has moved up for both 2026 and 2027 over the past 60 days.
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Onto Innovation currently sports a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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