IQE (IQE) H2 2024 earnings summary

Executive summary

• Strategic review underway, considering both IPO and full sale of Taiwan operations to achieve a debt-free position and enable reinvestment in growth areas.

• New CEO Jutta Meier appointed, bringing stability, financial discipline, and a renewed focus on operational efficiency and growth markets, with a 10% headcount reduction.

• Organizational changes and a transformation office established to drive program delivery and digital transformation.

• Expanded customer base and pipeline aligned to diversification strategy, especially in GaN Power and microLED.

Financial highlights

• Revenue for the year was £118.0m, up 2% year-over-year, with adjusted EBITDA improving to £8.2m from £4.3m.

• Adjusted LBIT improved from £20.2m to £18.3m.

• Adjusted operating cash flow decreased from £15.7m to £6.1m due to increased working capital for inventory build.

• Net operating cash flow for the year was £1.3m.

• CapEx for 2024 was £11.4m, focused on GaN expansion and diversification.

Outlook and guidance

• Revenue and adjusted EBITDA for FY25 expected within analyst forecast ranges (£115.1m–£123.0m revenue; £7.4m–£10.0m EBITDA), with a second-half weighting due to Q1 destocking and seasonality.

• Strong customer pipeline, especially in AI infrastructure, with growth expected in the second half of 2025.

• Strategic review outcome will determine future investment and growth trajectory.

• No direct impact from US tariffs; forecasts assume inclusion of Taiwan revenues.