IQE hit by market softness, eyes recovery in second half

(Sharecast News) - Semiconductor business IQE reported a sharp drop in first-half revenues and a widening of interim losses, as weakness in global semiconductor markets continued to weigh on demand.

IQE said revenues fell 31.3% to �45.3m in the six months ended 30 June, swinging the group from adjusted underlying earnings of �6.6m in H124 to an adjusted underlying loss of �400,000 in H125, citing ongoing inventory correction across the industry and softer demand in wireless and photonics as key drivers of the decline. reported pre-tax losses almost doubled, widening from �12.1m to �23.5m.

Despite the challenging backdrop, IQE said it had made strategic progress during the half, including the launch of a new silicon photonics platform and the signing of a multi-year supply agreement with a major US customer. It also highlighted cost savings from its restructuring programme, which was expected to deliver �7m in annualised benefits.

Looking ahead, IQE said the second half had started in line with expectations, with revenue and EBITDA both forecast to improve sequentially.

IQE also reiterated its full-year guidance and said it remained confident in its long-term strategy, supported by growing demand for advanced sensing and connectivity applications.

Chief executive Jutta Meier said: "Our first half performance fell short of expectations, driven by a combination of market headwinds and the unwinding of customer inventory. Despite this, I remain encouraged by the progress we have made and our continued investment in innovation is yielding promising results.

"Looking ahead, our operational discipline supports IQE's long-term vision centred on sustainable growth. This is underscored by our continued strong customer pipeline, which reinforces my confidence in our diversification strategy."

As of 0835 BST, IQE shares were up 0.13% at 7.80p.

Reporting by Iain Gilbert at Sharecast.com