IQE plc (LSE:IQE) said trading during the first half of 2026 exceeded management expectations, prompting the company to raise its full-year revenue outlook. Growth has been driven by strong demand across its core markets, particularly for Indium Phosphide products used in optical photonics applications supporting artificial intelligence and data centre infrastructure. IQE expects first-half revenue of at least £64 million and has increased its guidance to forecast revenue growth of more than 30% for the full year. The company also expects adjusted EBITDA to reach the low teens of millions of pounds while maintaining a debt-free banking position and cash reserves of £41.6 million.
Management said demand has remained strong across several strategic markets, including aerospace and defence, 3D sensing and wireless communications. The company expects this momentum to continue into the second half of the year, reflecting the benefits of its ongoing transformation strategy and its leadership in advanced compound semiconductor materials. IQE believes its expanding role within AI and data centre supply chains further strengthens its relationships with key customers and positions the business to benefit from long-term growth in semiconductor demand.
Despite the improved trading outlook, IQE continues to face financial challenges following a period of losses, negative gross profit in 2025, negative free cash flow, rising debt and lower shareholder equity. However, recent share price momentum has strengthened, with technical indicators remaining positive. Valuation remains more difficult to assess given the absence of positive earnings and dividend payments.
About IQE plc
IQE plc is a Cardiff-based manufacturer of advanced compound semiconductor wafers and materials used in a wide range of technology applications, including communications infrastructure, artificial intelligence, data centres, automotive electronics, industrial systems and aerospace and defence.
The company operates large-scale epitaxy manufacturing facilities in the UK, the United States and Taiwan, supplying semiconductor manufacturers and original equipment manufacturers worldwide. Through its expertise in advanced materials and extensive intellectual property portfolio, IQE develops high-performance wafer technologies that support next-generation electronic and photonic devices.
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