IQE (LSE:IQE) has reported strong momentum in the second half of 2025, supported by faster-than-anticipated funding flows into U.S. military and defence programmes, resilient photonics demand from AI and data centre customers, and stronger wireless sales tied to new handset launches. These trends were particularly evident in the group’s Taiwan operations.
As a result, the company now expects full-year 2025 revenue of around £97m and adjusted EBITDA of at least £2.0m, placing performance at the top end of its previous guidance range. The improvement reflects higher capacity utilisation across the business, a year-end cash balance of £15.6m, and the benefit of an HSBC waiver on fourth-quarter 2025 EBITDA covenant testing. Looking ahead, IQE enters 2026 with a strong first-quarter order book and continues to progress a strategic review process that has attracted multiple non-binding offers for the group and selected assets, highlighting external interest even though no transaction is assured.
From an outlook perspective, sentiment remains constrained by weak underlying financial metrics, including ongoing losses, very thin margins and limited cash flow generation. Valuation support is also restricted by negative earnings. While technical indicators show strong near-term momentum, overbought signals and a weaker longer-term trend reduce the overall positive impact.
More about IQE plc
IQE plc is a Cardiff-based, AIM-listed global supplier of advanced compound semiconductor wafers and materials solutions. Its products are used across smart connected devices, communications infrastructure, automotive and industrial markets, as well as aerospace and security applications. With operations in the UK, United States and Taiwan, and a substantial intellectual property portfolio, IQE serves leading global chipmakers and OEMs in markets characterised by high barriers to entry.
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