IQE (AIM:IQE), the AIM-listed supplier of compound semiconductor wafer products, reported first-half revenue of £64.6m, up 43% year-on-year from £45.3m.
Adjusted EBITDA turned positive at £6m, compared with a loss of £0.4m in the same period last year.
The Cardiff-based group's photonics division led the recovery, with revenue up 45% to £38.5m on funding releases for US military and defence programmes and continued growth in AI and data centre markets.
Wireless revenue rose 40% to £26m, reflecting market share gains and new customer platform qualifications.
Cash and cash equivalents stood at £41.6m at 30 June, with the group moving to an adjusted net cash position of £30.2m, a reversal from adjusted net debt of £23.5m a year earlier, following its strategic review and fundraising proceeds.
Reported net cashflow from operations was £1.2m, down from £3.6m, after a £4m working capital outflow and £2.4m of restructuring and strategic review costs.
"I am pleased to report a strong first half performance, with more than 40% revenue growth year-on-year across our core markets driving profitability," said chief executive Jutta Meier, adding that the group will convert existing tooling in the second half to expand Indium Phosphide capacity for AI and data centre demand.
IQE said trading exceeded management expectations and reiterated full-year guidance of revenue growth in excess of 30%, resulting in low-teens £m adjusted EBITDA.
News Intelligence what this means for the company
IQE swung to £6m adjusted EBITDA profit in H1 2026 on 43% revenue growth to £64.6m, driven by photonics (up 45% on US defence and AI/data centre demand) and wireless (up 40% on market share gains). The company has moved to £30.2m adjusted net cash from £23.5m adjusted net debt a year earlier, reversing the cash drain that marked FY2025, and reiterated full-year guidance for over 30% revenue growth and low-teens £m adjusted EBITDA—a trajectory that validates the strategic pivot and fundraising executed after the year end.
Profitability has returned and cash generation is positive, anchored on real demand (US defence, AI/data centre) rather than inventory build. The focus is now execution: converting existing tooling to expand Indium Phosphide capacity in H2 must deliver the guided low-teens EBITDA, and the 25.3% dilution from the £81m raise must be offset by revenue and margin growth to justify the enlarged share base.
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