The Short Answer
Advanced Energy (AEIS) is qualitatively halal, but methodology-dependent on the current quantitative screen. Advanced Energy provides highly-engineered, precision power-conversion, measurement, and control solutions.
Precision-power-conversion and measurement-and-control-instrumentation manufacturing are generally permissible at the activity level. The March 31, 2026 filing reports debt/assets of 22.18%, liquidity/assets of 26.98%, and receivables-plus-cash/assets of 41.51%; the FTSE-style and Malaysia-style known ratios pass, while the MSCI-style receivables screen fails.
Current quantitative Sharia screen
Based on 10-Q figures for the period ended 2026-03-31; calculated 2026-07-15.
575 / 2,592.9
699.5 / 2,592.9
1,076.2 / 2,592.9
5.8 / 511
- Financial
- Pass
- Overall
- Incomplete
Debt/assets is 22.18%, liquidity/assets is 26.98%, receivables-plus-cash/assets is 41.51% and disclosed interest income is 1.14%; known financial ratios pass, but the activity numerator is incomplete.
- Financial
- Fails
- Overall
- Fails
Receivables-plus-cash/assets is 41.51%, above the examined MSCI 33.33% limit; debt/assets and liquidity/assets pass.
- Financial
- Pass
- Overall
- Incomplete
Known debt and liquidity ratios pass the examined Malaysia limits; this is not an official classification and prohibited activity is not separately quantified.
- Financial
- Not calculated
- Overall
- Not calculated
A licensed historical market-cap series is not stored; the total-assets ratios are shown separately.
Business-activity disclosure
Advanced Energy designs and manufactures precision power-conversion, measurement and control products for semiconductor, data-center, industrial and medical applications. The core activity is generally permissible, but the filing does not provide a universal prohibited-revenue numerator for all end uses and customers.
Limitation: No universal prohibited-activity revenue numerator or scholar-specific purification percentage is disclosed; the screen does not invent one.
Purification
Advanced Energy discloses $5.8 million of interest income, but no scholar-specific purification percentage is asserted and the activity numerator remains incomplete.
Inputs, assumptions and primary sources
- Amounts are USD millions from Advanced Energy's March 31, 2026 Form 10-Q.
- Debt is the $575.0 million convertible senior-notes carrying amount; the revolving facility was undrawn at period end and operating leases are excluded.
- Cash and cash equivalents are $699.5 million; no separately identified interest-bearing securities balance is included.
- Accounts receivable, net is $376.7 million and first-quarter revenue is $511.0 million.
- The filing reports $5.8 million of interest income, or 1.14% of revenue. No universal prohibited-revenue numerator is disclosed.
- Semiconductor equipment, data-center power, industrial and medical products are generally permissible, while end-use and customer concentration remain qualitative context.
This is a reproducible financial screen, not a fatwa. A failed total-assets screen can coexist with a pass under a market-cap methodology. ZakatInvest keeps the qualitative assessment separate so numerical thresholds do not erase material context.
Sharia Screening Methodology
Islamic scholars use several criteria to screen stocks:
- Business activity screen: Is the company's primary business halal?
- Debt ratio: Total debt / market cap must be under 33%
- Interest income: Interest income / total revenue must be under 5%
- Haram revenue: Revenue from haram sources must be under 5%
- Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)
Advanced Energy's Business Activity
Advanced Energy designs and manufactures:
- Process power: High-voltage and low-voltage RF and DC power-delivery systems used in semiconductor-manufacturing equipment
- Precision power supplies: Power supplies for industrial-and-medical applications
- Measurement & control: Thermal-instrumentation, temperature-measurement, and gas-and-reactive-power solutions
These are general-purpose engineered-equipment businesses — manufacturing precision power-conversion and measurement hardware. This is permissible at the activity level.
Concerns to Be Aware Of
1. Leverage Profile
Advanced Energy carries some debt alongside a sizable cash position. The debt-to-market-cap ratio should be verified against the 33% threshold at the time of investment, and re-verified following any material acquisitions.
2. Customer Concentration & Cyclicality
Revenue is concentrated among a small number of large semiconductor-equipment OEM customers and is sensitive to the semiconductor-capital-equipment cycle. This is a business-cycle and customer-concentration consideration rather than a Sharia screen concern.
3. Minor Interest Income
Minor interest income on cash balances means purification of a small portion of dividends may be advisable.
Filing-Based Ratios (March 31, 2026)
Based on Advanced Energy's latest Form 10-Q and consolidated financial statements:
- Debt / assets: 22.18%, below the examined 33.333% limit.
- Cash + interest-bearing securities / assets: 26.98%, below the examined liquidity limit.
- Receivables + cash / assets: 41.51%; below the examined FTSE 50% limit but above the MSCI-style 33.33% limit.
- Disclosed interest income / revenue: 1.14%.
- Prohibited-activity revenue: Not separately disclosed; no universal percentage is invented.
Methodology Interpretation
The current result is methodology-dependent: FTSE-style and Malaysia-style known financial ratios pass, while the MSCI-style receivables-plus-cash ratio fails. The business-activity numerator remains incomplete, and this is not a claim about any external agency or a universal scholarly ruling.
Bottom Line
Advanced Energy (AEIS) is qualitatively halal but methodology-dependent quantitatively on this current screen. The core business — precision power-conversion and measurement-and-control products — is generally permissible; investors should apply the methodology they follow and revisit the receivables and liquidity inputs after new filings.
For Muslim investors seeking semiconductor-and-industrial equipment exposure, AEIS sits alongside other halal-screened names like Entegris (ENTG) and Keysight (KEYS).
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