IQE celebrates "strong first half" as revenue jumps and loss narrows
IQE PLC reported double-digit revenue growth and a surge in adjusted earnings for its first half, with trading that surpassed internal expectations and reinforced its confidence for the full year.
The Cardiff, Wales-based maker of compound semiconductor wafer products booked a pretax loss of £12.6 million for the first half of 2026, narrowed from £18.3 million the year before.
Revenue, meanwhile, jumped by 43% to £64.6 million from £45.3 million.
IQE noted that Wireless revenue increased 40% to £26.0 million from £18.6 million, "reflecting market share gains and increased sales of wireless mobile connectivity solutions across newly qualified customer platforms." Photonics revenue increased 45% to £38.5 million from £26.6 million, which IQE said was "driven by a combination of funding releases for certain US military and defence programmes and continued growth in AI and data centre related markets."
Adjusted earnings before interest, tax, depreciation and amortisation totalled £6.0 million, swung from a £384,000 loss. The measure excludes "certain non-cash charges, non-operational items and significant infrequent items".
IQE said the surge to profitability "reflects the combination of a higher revenue base and improved gross margins.
"Margin expansion was driven by increased utilisation of manufacturing assets and capacity across the group, together with a more favourable product mix resulting from a higher proportion of Photonics sales."
Chief Executive Officer Jutta Meier commented: "I am pleased to report a strong first half performance...This reflects the strong momentum we are seeing across AI-driven data centre infrastructure, advanced sensing, wireless and defence applications, alongside improved operational execution and a more favourable product mix.
"During the period, we have demonstrated our ability to capture long-term growth opportunities across these critical markets, underpinned by a number of key supply agreements. IQE is uniquely positioned to meet customer needs and will be converting existing capacity in H2 to support the increasing demand for indium phosphide solutions."
Looking ahead, after first-half trading "exceeded management expectations," IQE "has continued to see strong momentum...which is expected to support growth through the remainder of 2026 and beyond."
IQE said it remains confident it will achieve its full-year guidance of on-year revenue growth exceeding 30%, and adjusted Ebitda in the low-teen millions.
It "also sees potential for upside opportunities in optical communications for data centre and AI infrastructure, underpinned by recently signed supply agreements."
Additionally, Meier noted that IQE has "initiated a move to the Main Market of the London Stock Exchange, marking an important next step in [its] development".
IQE shares were up 1.1% at 47.95 pence late on Monday morning in London.
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