Magnachip Semiconductor (MX) Q1 2026 earnings summary

Executive summary

• Q1 2026 consolidated revenue reached $46.2 million, up 3.3% year-over-year and 13.9% sequentially, at the midpoint of guidance, aided by a one-time sales incentive program to reduce channel inventory.

• Gross profit margin was 15.6%, up from 9.3% in Q4 2025 but down from 20.9% in Q1 2025, mainly due to unfavorable product mix and ASP erosion in China.

• Operating loss from continuing operations was $7.2 million, improved from $12.4 million in Q4 2025 but worse than $5.3 million in Q1 2025.

• Adjusted EBITDA was negative $3.6 million, better than negative $8.9 million in Q4 2025 but down from negative $1.2 million in Q1 2025.

• Launched new 8th-generation products and on track to introduce 55 new-generation products in 2026, expected to drive future revenue and margin improvement.

Financial highlights

• Power Analog Solutions revenue was $41.6 million, up 4.5% year-over-year and 13.1% sequentially; Power IC revenue was $4.6 million, down 6.2% year-over-year but up 21.3% sequentially.

• Gross profit was $7.2 million, down from $9.4 million in Q1 2025 but up from $3.8 million in Q4 2025.

• SG&A expenses were $7.7 million in Q1, down from $9.2 million in Q1 2025; R&D expenses increased to $6.7 million, reflecting higher investment in new product development.

• Cash and cash equivalents at quarter-end were $94.6 million, down from $103.8 million at year-end 2025.

• Adjusted loss per share (diluted) was $0.11, compared to $0.08 in both Q4 2025 and Q1 2025.

Outlook and guidance

• Q2 2026 revenue is expected between $44.5 million and $48.5 million, roughly flat sequentially and down 2.3% year-over-year at the midpoint.

• Gross profit margin guidance for Q2 is 17%-19%, higher than Q1 but below Q2 2025.

• Gross margins are expected to decline in Q3 and Q4 2026 due to a planned electrical substation upgrade impacting factory utilization.

• New generation products are expected to comprise 10% of total revenue in Q4 2026, up from 2% in 2025.

• Management expects sufficient liquidity to fund operations, debt service, and capital expenditures for the next 12 months.