GlobalWafers (6488) Q1 2026 earnings summary

Executive summary

• Q1 2026 saw gradual semiconductor market recovery, driven by AI, HPC, and broader end-market applications, with inventory correction largely complete but recovery still uneven.

• Revenue for Q1 2026 was NT$13,985 million, down 3.6% sequentially and 10% year-over-year, with net income of NT$1,895.9 million, up 30% from Q1 2025.

• Gross margin declined to 20.8% from 25.7% in Q4 2025 and 26% in Q1 2025, while operating margin dropped to 10.5% and net margin improved to 14%.

• Expansion projects are moving from investment to ramp-up and qualification, with operational focus shifting to realizing returns.

• Government subsidies from the US and Europe exceeded TWD 11 billion, strengthening the balance sheet and financial flexibility.

Financial highlights

• Q1 2026 revenue was TWD 13.98 billion, down 3.57% quarter-over-quarter; gross profit was TWD 2.91 billion, with a gross margin of 20.8%.

• EPS was TWD 3.97, up from TWD 3.05 in Q1 2025.

• EBITDA for Q1 2026 was NT$4,060 million, with a margin of 29.0%.

• Net profit increased 30.2% year-over-year, mainly due to mark-to-market gains on Siltronic shares.

• Prepayment balance at TWD 23.5 billion, down 5.5% QoQ, reflecting fulfillment of long-term agreements.

Outlook and guidance

• Full-year 2026 operating performance expected to improve sequentially and exceed 2025 levels on a constant currency basis.

• AI infrastructure investment and advanced packaging are expected to offset macro headwinds and sustain high utilization in 12-inch wafer lines.

• Recovery in mature-node segments and smaller-diameter wafers is anticipated as inventory normalization progresses.

• CapEx has peaked; focus is now on ramp-up, yield improvement, and operational efficiency.

• Pricing improvement is anticipated in the second half of 2026, especially for 12-inch wafers, due to high utilization and rising costs.