MKS (MKSI): A Mission Critical Semiconductor Supplier Behind Next Gen Chip Making

Spyglass Growth Strategy rose 24.63% in the second quarter, outperforming the Bloomberg Midcap Growth Index, Bloomberg 2500 Growth Index and Bloomberg 500 Index, which gained 14.05%, 19.01% and 15.61%, respectively. Performance benefited from easing geopolitical tensions, including a US-Iran ceasefire, lower oil prices and a software-stock rebound. Small-cap and growth shares outperformed, led by Technology, Industrials and Financials. Portfolio earnings growth remains above 40%, and 85% of holdings exceeded revenue estimates, although multiple compression produced a slight negative year-to-date return. Spyglass believes fundamentals will ultimately overcome volatility and that market inefficiencies may create opportunities. In its Q2 2026 investor letter, Spyglass identified MKS Inc. (NASDAQ: MKSI) as a new position. MKS provides foundational technology for semiconductor manufacturing, electronics and packaging, and specialty industrial applications. On July 30, 2026, the shares closed at $293.30, implying a $19.82 billion market capitalization. The stock had declined 19.77% over one month but gained 216.23% over 52 weeks. MKS supplies vacuum, gas-delivery, RF-power and photonics subsystems used in wafer-fabrication equipment sold by Applied Materials, Lam Research, Tokyo Electron, KLA and ASML. Spyglass said MKS holds the No. 1 or No. 2 position in products touching approximately 85% of wafer-fabrication-equipment spending. MKS semiconductor revenue historically represented 2% to 2.5% of WFE spending, but fell to roughly 1.5% in 2023-25 as customers absorbed excess inventory, not because of share loss. With inventories normalized, Spyglass expects intensity to recover as AI drives WFE spending from approximately $110 billion in 2025 toward $175 billion or more by 2027. Chiplets and high-bandwidth memory could further support advanced packaging demand, where Spyglass views MKS as a leader in laser via drilling and electroplating chemistry. NAND exposure remains a market concern, but NAND capital spending is near trough levels after overcapacity; a recovery would therefore offer upside.