CVD Equipment Corporation (CVD) designs, develops, and manufactures a broad range of equipment used to develop and manufacture materials and coatings for the compound semiconductor, semiconductor, aerospace, battery energy storage markets as well as advanced industrial applications, and research.
The company conducts its business through three reportable operating segments: i) CVD Equipment that supplies chemical vapor deposition, physical vapor transport and thermal process equipment; ii) SDC...
CVD Equipment Corporation (CVD) designs, develops, and manufactures a broad range of equipment used to develop and manufacture materials and coatings for the compound semiconductor, semiconductor, aerospace, battery energy storage markets as well as advanced industrial applications, and research.
The company conducts its business through three reportable operating segments: i) CVD Equipment that supplies chemical vapor deposition, physical vapor transport and thermal process equipment; ii) SDC that designs and manufactures ultra-high purity gas and chemical delivery control systems; and iii) CVD Materials that provide products related to advanced materials and coatings.
On May 26, 2023, the company sold its Tantaline subsidiary located in Nordborg, Denmark. The decision to sell Tantaline was based on the company’s ongoing strategy to focus on the equipment business consisting of the CVD Equipment and SDC segments and reduce its focus on the non-core CVD Materials business.
Key Growth Strategies
The company’s core strategy is to focus on growth market applications in end markets related to the ‘electrification of everything,’ aerospace and industrial applications. The phrase ‘electrification of everything’ refers to the shift from fossil fuels to the use of electricity to power devices, buildings, electric vehicles (‘EVs’), and many other applications. With respect to aerospace, the company’s systems are being used by the company’s customers to produce ceramic matrix composite materials (‘CMCs’) that will be used in next generation gas turbine jet engines with the objective of reducing jet fuel consumption and contributing to the decarbonization of that industry.
The company’s strategy yielded multisystem orders of PVT150 equipment that was delivered to one company that manufactures silicon carbide wafers.
In February 2024, the company received an order from an additional customer for the company’s new PVT200 system used to grow silicon carbide crystals for the manufacture of 200 mm wafers. This represents the company’s second customer for its PVT equipment. This customer plans to evaluate the company’s equipment for potential additional purchases of PVT equipment. The company has also received orders from OneD Battery Materials in 2023, a company that is engaged in providing battery nanomaterials.
Both technologies are essential for the support of the EV market. These systems should provide the company with standard product offering to continue to support the EV focused market, as well as energy storage, power conversion and power transmission. The company plans to expand its product offerings in the power electronics market to build off the introduction of the PVT150 and PVT200 systems. The company is also evaluating its ability to provide other equipment used in the manufacturing process of silicon carbide wafers.
During 2022, the company also received an order from an aerospace company for a production chemical vapor infiltration (CVI) system that will be used to manufacture CMCs for gas turbine jet engines. In 2023, the company received an order from the same aerospace company for an additional three CVI systems.
In February 2024, the company received a multisystem order from an industrial customer for approximately $10 million that will be used for depositing a silicon carbide protective coating on OEM components.
Major Target Markets
The company’s major target markets are high power electronics, EV battery materials / energy storage and aerospace, defense and industrial applications – all of which have the objective of improving energy efficiency.
High Power Electronics
Through December 31, 2023, the company has received and delivered orders for 30 of the company’s PVT150 physical vapor transport systems from one customer, which uses the company’s systems to grow silicon carbide crystals that are made into 150 mm silicon carbide wafers for use in power electronics. In late 2023, the company launched its PVT200 system designed to manufacture silicon carbide crystals for 200 mm wafer and received the company’s first order from a second customer. The company plans to expand its marketing and future product development for the PVT product line, as well as expand the company’s product offerings to manufacturers of silicon carbide wafers.
EV Battery Materials / Energy Storage
The company has experienced increased interest and demand for nanotechnology materials including carbon nanotubes (CNTs), graphene and silicon nanowires (Si-NWs) to support the development and manufacturing for battery materials used in electric vehicles. The company received two system orders in 2021 to deposit coatings onto powders used in silicon-graphite anodes, including a production system and a second for research and material development. The company received additional system orders from this customer in 2023 that were completed during 2023.
Aerospace & Defense
CVD is a leading manufacturer of CVI and tow-coating systems to manufacture CMCs for aerospace gas turbine jet engine applications. The company’s customers include two of the leaders in aerospace gas turbine engines.
The company continues to engage customers in the aerospace market regarding CMCs. During 2022, the company received an order for a production CVI system. The company received an additional order for three CVI systems during 2023 from the same customer. These systems will be used to manufacture CMCs for aerospace gas turbine jet engines.
The company’s future growth will be derived from production applications in the company’s major target markets. The company’s legacy product line continues to provide advanced equipment and subsystems to enable development of emerging technology and research applications.
The company’s wholly owned subsidiary, CVD Materials Corporation, includes its MesoScribe product lines. The company’s MesoScribe product line supports the aerospace and defense markets with novel robust direct write instrumentation. The company plans to wind down the operations of MesoScribe in 2024 after satisfaction of customer purchase orders.
Segments
CVD Equipment segment supplies chemical vapor deposition and thermal process equipment targeting growth production markets, as well as systems for use in research and development. This includes systems marketed under the FirstNano product brand. Utilizing the company’s expertise in the design and manufacture of chemical vapor deposition and thermal process equipment, the company provides material processing capability and control at a competitive cost of ownership.
The targeted growth production markets include high power electronics (both silicon carbide (SiC) and gallium nitride (GaN)), aerospace advanced materials primarily for gas turbine jet engines, and nanomaterials used in batteries. The product group also consists of legacy products serving the production and R&D applications such as semiconductors, LEDs, carbon nanotubes, nanowires, solar cells and a number of other industrial & research applications.
The company’s developments and opportunities for the carbon composite business come from achievements in the company’s Applications Laboratory. The Applications Laboratory, along with the sales and marketing team continue to explore carbon-based products and applications that can be made from the company’s CNT, infiltrated carbon/CVI and carbon nano fiber technology (CNF). Some applications include CNT and infiltrated carbon/CVI based battery material and CNF capacitors for 5G technology.
To support new emerging applications, the company provides equipment to and collaborate with laboratory scientists to bring state-of-the-art processes from the research laboratory into production. CVD Equipment group provides process development value through the company’s Application Laboratory where the company’s personnel interact directly with the scientists and engineers of the company’s customer base to develop solutions to tomorrow’s challenges today. CVD Equipment segment operates from the company’s 135,000 sq. ft. facility in Central Islip, New York.
SDC segment designs and manufactures ultra-high purity gas and chemical delivery control systems for state-of-the-art semiconductor fabrication processes, aerospace, solar cells, LEDs, carbon nanotubes, nanowires, and a number of industrial applications. The company’s SDC products are sold on a stand-alone basis and are also integrated into certain CVD equipment. This internal supply of chemical and gas delivery systems and components provide a competitive advantage for the company’s CVD Equipment group over its competition. SDC operates from a 22,000 square foot facility fitted with a clean room manufacturing space located in Saugerties, New York.
CVD Materials segment consist of MesoScribe’s direct write printed electronics business. MesoScribe provides MesoPlasma printing services and products (heaters, antennas, and sensors) to aerospace, satellite, power generation, defense, and other markets requiring high performance. MesoScribe operations are located at the company’s main facility in Central Islip, New York.
On August 8, 2023, the company entered into an agreement with a third party to sell certain assets and license certain proprietary information of MesoScribe. The company will continue to fulfill remaining orders for MesoScribe products through the end of 2024 at which time the company plans to cease the remaining operations of MesoScribe and dispose of any remaining equipment.
Products and Technology
Chemical Vapor Deposition/Infiltration
Chemical vapor deposition is a method of coating or growing material through a chemical recombination at elevated temperatures onto or within pores of a substrate material. A single or collection of gases or vapor introduced on to the surface or into pores of a substrate material that is heated to such a degree that the gases decompose and deposits a desired layer onto and or into a substrate material. Chemical vapor infiltration (CVI) is a variant of a chemical vapor deposition process that is performed at low pressures to allow for coating the internal surfaces of a porous material. Using heat and low pressure, precursor vapors penetrate the pores/fiber of the material and deposit to form a conformal coating on the internal surfaces. Both processes are accomplished by combining appropriate gases in a reaction chamber, of the kind the company manufactures, at elevated temperatures (typically 500° to 2,500° Celsius). The company’s chemical vapor deposition and CVI systems are complete and include all necessary heating techniques, precise control instrumentation, gas delivery and abatement subsystems and components and include state-of-the-art proprietary process control software. The company provides both standard and emerging applications specified products. Some of the standard systems the company offers are for SiC, GaN, Aluminum Nitride (AlN), CMCs, silicon (Si), CNT, graphene, silicon nanowires. The systems are sold under the CVD and FirstNano product brands.
Physical Vapor Transport (PVT)
While the PVT150 was officially launched for production in 2022, the company has sold PVT systems in prior years and have pioneered both resistive heating and more effectively inductively heated PVT systems. The PVT150 system was specifically designed to address the SiC crystal growth market for 150 mm substrates or wafers. Designed to provide enhanced process parameter control it allows existing and future customers the ability to tightly control and monitor the crystal growth process for 150mm substrates. A 200 mm version called the PVT200 was developed during 2023 and the first order was received in February 2024. The crystal growth technique utilized a high temperature furnace to vaporize from seed granular material of SiC and further deposit out in an ordered crystal structure onto substrate wafer. The process takes days to over a week to complete and yield a SiC crystal ready for further processing into wafers.
Rapid Thermal Processing (RTP)
Used to heat semiconductor materials to elevated temperatures of up to 1,200° Celsius at rapid rates of up to 200° Celsius per second. The company’s RTP systems are offered for implant activation, oxidation, silicide formation and many other processes. The company offers systems that can operate both at atmospheric and reduced pressures.
Annealing, Diffusion and Low-Pressure Chemical Vapor Deposition (LPCVD) Furnaces
These furnaces are used for dislocation removal in crystals, dopant diffusion, oxidation, for SiC, Si, SiOx and other applications. The systems are normally operated at atmospheric and/or reduced pressure with gaseous atmospheres related to the process. An optional feature of the system allows for the heating element to be moved away from the process chamber allowing the wafers to rapidly cool or be heated in a controlled environment. The company’s temperature control system enables more precise control of the wafers. The systems are equipped with an automatic process controller, permitting automatic process sequencing and monitoring with safety alarm provisions.
Ultra-High Purity Gas and Liquid Control Systems
The company’s standard and custom designed gas and liquid control systems, which encompass gas cylinder storage cabinets, custom gas and chemical delivery systems, gas and liquid valve manifold boxes and gas isolation boxes, provide safe storage and handling of pressurized gases and chemicals. The company’s system design allows for automatic or manual control from both a local and remote location. These subsystems and components are provided to the general market, as well as support the CVD Equipment segment.
Quartzware
The majority of the company’s process equipment solutions, utilize quartz components which the company partially manufacturer internally. In addition, the equipment typically requires routine maintenance, consumable and spare parts. One such spare part and consumable which is core to the company’s technology offering is quartz hardware. The company provides standard and custom fabricated quartzware used in the company’s equipment and to a lesser extent for other customer tools.
MesoPlasma Direct Write Printing
A materials deposition process that provides robust direct write high-definition instrumentation, fine feature patterns, and coatings onto conformal components. The technique involves powder material that is injected into a thermal plasma where it is rapidly heated and deposited onto the substrate or component. The versatility of the process enables a wide range of materials to be deposited including ceramic dielectrics, nickel-based sensor alloys, metallic conductors, precious metals, and protective coatings. Products include temperature sensors, heaters, antennas and patterns per customer specifications.
Markets and Marketing
The company serves multiple emerging and mature global markets, including compound semiconductor high power electronics, aerospace, defense, battery energy storage, silicon and other microelectronic and micromechanical devices, semiconductor, universities, and research centers. Due to the highly technical nature of the company’s products, it is essential to engage with customers directly through the company’s sales personnel, the company’s network of domestic and international independent sales representatives, and distributors specializing in the type of equipment, products, and services that the company sells. The company’s primary marketing activities include direct sales engagement, participation in trade associations and trade shows and the company’s internet websites. The company expanded its marketing activities in 2023 through attendance at key tradeshows and online marketing.
Customers
The company’s systems and products are used in both production applications and advanced materials research. The company markets and sells primarily to companies that are the engaged in producing compound semiconductor wafers, aerospace gas turbine jet engine component material, defense, battery energy storage, silicon and other microelectronic and micromechanical devices, semiconductor, universities and research centers. The company has both a domestic and international customer base.
During the year ended December 31, 2023, three customers represented 14.3%, 13.5% and 10.9% of the company’s revenues.
Research and Development
For the year ended December 31, 2022, the company’s research and development expenses were $2.6 million.
Government Regulation
The company is subject to a variety of federal, state and local government regulations, such as environmental, labor and export control regulations.
Utilizing its in-house safety team, engineering expertise and consultants as required, the company continues to monitor and comply with applicable Environmental Health and Safety regulations at its facilities, as well as the installation of equipment at its customer facilities.
With respect to the company’s sales to customers located in China or elsewhere outside the United States, products which are manufactured in the United States, incorporate controlled the U.S. origin parts, technology, or software, or are based on the U.S. technology, are subject to the U.S. Export Administration Regulations (EAR). The company continues to monitor, review and maintain ongoing compliance with EAR with respect to its export sales.
History
CVD Equipment Corporation, a New York corporation, was founded in 1982. The company was incorporated in 1982.
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