IQE (AIM:IQE), the Cardiff-based supplier of compound semiconductor wafers, said trading in the six months to 30 June exceeded management expectations, with first-half revenue expected to reach at least £64m.
The group now expects full-year revenue growth in excess of 30% year-on-year, up from its previous guidance, with adjusted EBITDA reaching the low teens in millions of pounds.
Demand for IQE's Indium Phosphide (InP) solutions is accelerating due to their role in optical photonics products for data centres and AI infrastructure, with additional support from aerospace and defence, 3D sensing and wireless segments.
"I am very pleased that H1 trading exceeded our expectations", said chief executive Jutta Meier, adding that the group's position in InP and other material systems keeps it "critically embedded in supply chains enabling industry trends" expected to drive further progress in the second half.
IQE remains free of bank debt, with a cash position of £41.6m as at 30 June.
News Intelligence what this means for the company
IQE raised full-year revenue growth guidance to above 30% on first-half results that beat expectations, driven by surging demand for its indium phosphide semiconductors in AI and data-centre optical photonics. The company's cash position improved to £41.6m (debt-free) as at 30 June, a material swing from adjusted net debt of £31.5m at end-2025, and a multi-year InP supply agreement with Tower Semiconductor is now validating its strategic positioning in these high-growth end-markets.
The guidance raise and debt-free balance sheet materially strengthen IQE's near-term growth narrative, though the company's adjusted EBITDA margin (low teens in millions on >30% revenue growth) remains thin relative to the scale of capital deployed in the recent £81m fundraising. Execution risk on converting AI/data-centre demand into sustained profitability remains the key test.
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