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IQE plc (IQE) AI Stock Analysis

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GB:IQE

IQE plc

(LSE:IQE)

Rating:47Neutral
Price Target:
9.50p
▲(4.97% Upside)
IQE plc's overall stock score is primarily impacted by its financial challenges, including negative profitability and weak cash flow. Technical indicators suggest bearish momentum, and valuation metrics are unattractive. Despite some positive developments in earnings and corporate events, these are overshadowed by the company's ongoing financial and operational difficulties.

IQE plc (IQE) vs. iShares MSCI United Kingdom ETF (EWC)

IQE plc Business Overview & Revenue Model

Company DescriptionIQE plc develops, manufactures, and sells advanced semiconductor materials. The company operates in three segments: Wireless, Photonics, and CMOS++. It manufactures compound semiconductor wafers or epiwafers using epitaxy process; offers wireless products, including GaAs, GaN, and InP-based technologies, as well as Si and Ge-based epitaxial wafer structures; and supplies GaAs HBTs, pHEMTs, and BiFETs/BiHEMTs for use in consumer mobile handsets, connected devices, 5G network infrastructure, WiFi 6, Bluetooth, and satellite communications. The company also provides photonics products, which include vertical cavity surface emitting lasers, a 3D sensing technology that enables facial recognition, gesture control, light detection and ranging (LiDAR), and other advanced sensing applications; indium phosphide (InP) laser and detector wafers that powers high speed, 5G telecommunication, and data communication fiber optic networks; Gallium Nitride (GaN) and gallium arsenide (GaSb) for multicolor uLED displays; and a range of gallium antimonide (GaSb) and InP materials that enables high definition infrared imaging and sensing in security, health monitoring, and environmental applications. In addition, it offers substrate products, such as GaSb, InP, InAs, InSb, GaSb, CZT, custom size or geometry wafers, polycrystalline materials, high purity group iii/v source materials, and bespoke orientation substrates. Further, the company provides nanoimprint lithography services. The company serves in the United States, rest of the Americas, France, Germany, Israel, the United Kingdom, rest of Europe, the Middle East, Africa, the People's Republic of China, Japan, Taiwan, and rest of the Asia-Pacific. IQE plc was founded in 1988 and is headquartered in Cardiff, the United Kingdom.
How the Company Makes MoneyIQE generates revenue primarily through the sale of its semiconductor materials to various clients in the telecommunications, automotive, and consumer electronics sectors. The company operates on a business model that includes long-term contracts with major manufacturers, ensuring a steady stream of income. Key revenue streams include the sales of epitaxial wafers and related products, along with licensing agreements for its proprietary technologies. Significant partnerships with industry leaders in the wireless and optoelectronics markets further enhance IQE's earnings potential, as they enable the company to leverage its advanced manufacturing capabilities and expertise to meet the growing demand for high-performance semiconductor solutions.

IQE plc Earnings Call Summary

Earnings Call Date:May 13, 2025
(Q4-2024)
|
% Change Since: |
Next Earnings Date:Sep 16, 2025
Earnings Call Sentiment Neutral
The earnings call outlined significant improvements in adjusted EBITDA and wireless revenue growth, driven by strategic partnerships and product developments. However, these positives were tempered by a decline in photonics revenue, challenging macroeconomic conditions, and ongoing financial constraints, indicating a mixed outlook.
Q4-2024 Updates
Positive Updates
Adjusted EBITDA Improvement
Adjusted EBITDA improved significantly from £4.3 million to £8.2 million, reflecting decisive cost actions and increased efficiencies.
Wireless Revenue Growth
Wireless segment revenue increased by 25% to £67.3 million, driven by increased penetration into the Asian market and the Android ecosystem, as well as an increase in GaN sales for 5G infrastructure.
Strategic Partnerships and Product Development
IQE launched a joint development agreement with X-FAB for GaN power in Europe and continued development in MicroLED and Quantum Dot Laser foundry services, strengthening its position in emerging technologies.
Negative Updates
Photonics Revenue Decline
Photonics segment revenue decreased by 16% to £49.9 million, due to softness in the 3D sensing and pixels market.
Macroeconomic and Industry Challenges
The macro environment remains challenging with slow industry recovery, weak global smartphone sales, and geopolitical tensions impacting supply chains.
Ongoing Debt and Financial Constraints
The company faces significant financial constraints with a net debt position and a balance sheet impacted by lease liabilities and interest payments. The strategic review aims to address these issues.
Company Guidance
In the recent IQE full-year results presentation, CEO Jutta Meier emphasized the company's strategic focus on financial discipline and operational agility amidst a challenging macroeconomic environment. The company's revenue for fiscal year 2024 remained stable at £118 million, while adjusted EBITDA improved significantly from £4.3 million to £8.2 million, attributed to decisive cost actions and efficiency improvements. The strategic review aims to make IQE debt-free and allow further investments in growth sectors such as GaN power and display technologies. Despite a 16% decline in Photonics revenue, Wireless revenue increased by 25% to £67.3 million, driven by higher penetration into the Asian market and increased GaN sales for 5G infrastructure. The company's cash position was bolstered by a convertible loan note fundraise, resulting in cash and cash equivalents of £20.6 million at the end of Q1 2025. Looking ahead, IQE expects revenue and adjusted EBITDA for fiscal year 2025 to align with analyst forecasts, with improvements anticipated in the second half of the year, driven by AI-related demand and strategic initiatives.

IQE plc Financial Statement Overview

Summary
IQE plc faces significant financial challenges, with stagnant revenue growth, negative profit margins, and weak cash flow generation. The balance sheet shows increasing leverage, posing risks if operational performance does not improve.
Income Statement
45
Neutral
IQE plc has faced declining revenues, with a 1.5% increase from 2023 to 2024, but a significant drop from 2020 levels. Gross profit margin remains low at 3.77% for 2024, indicating cost pressures. Net profit margin is negative, which is concerning for profitability. The EBIT and EBITDA margins are also negative, reflecting operational challenges and a lack of profitability.
Balance Sheet
55
Neutral
The company's debt-to-equity ratio has increased, reaching 0.55 in 2024, suggesting rising financial leverage. Return on Equity is negative due to net losses, indicating poor returns for shareholders. The equity ratio stands at 54.30%, showing a moderate reliance on equity financing, which provides some balance sheet stability.
Cash Flow
40
Negative
The free cash flow growth rate is negative, highlighting deteriorating cash generation capabilities. Operating cash flow to net income ratio is negative due to consistent net losses, indicating cash flow issues. Free cash flow to net income is also negative, underscoring inefficiencies in converting earnings into cash.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue118.03M115.25M167.50M154.10M178.02M
Gross Profit4.45M2.33M26.40M17.64M33.15M
EBITDA-6.22M-1.11M-46.68M5.23M19.02M
Net Income-38.18M-29.38M-74.50M-31.00M-2.89M
Balance Sheet
Total Assets247.05M273.51M296.10M351.22M371.29M
Cash, Cash Equivalents and Short-Term Investments4.66M5.62M11.60M10.79M24.66M
Total Debt73.99M54.15M77.60M70.98M69.76M
Total Liabilities112.94M103.73M121.00M116.60M110.85M
Stockholders Equity134.11M169.78M175.10M234.62M260.44M
Cash Flow
Free Cash Flow-17.72M-12.20M-12.00M-3.00M22.92M
Operating Cash Flow-2.88M5.92M5.90M15.39M33.32M
Investing Cash Flow-10.19M-17.96M-10.70M-18.30M-11.77M
Financing Cash Flow12.16M6.63M4.80M-11.17M-5.55M

IQE plc Technical Analysis

Technical Analysis Sentiment
Negative
Last Price9.05
Price Trends
50DMA
9.73
Negative
100DMA
9.86
Negative
200DMA
11.23
Negative
Market Momentum
MACD
-0.21
Negative
RSI
41.76
Neutral
STOCH
53.20
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:IQE, the sentiment is Negative. The current price of 9.05 is below the 20-day moving average (MA) of 9.28, below the 50-day MA of 9.73, and below the 200-day MA of 11.23, indicating a bearish trend. The MACD of -0.21 indicates Negative momentum. The RSI at 41.76 is Neutral, neither overbought nor oversold. The STOCH value of 53.20 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:IQE.

IQE plc Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
65
Neutral
£44.02M197.300.50%5.03%-26.16%-99.62%
61
Neutral
$35.48B7.63-10.11%1.88%8.73%-9.23%
47
Neutral
£88.39M-25.13%2.41%-16.47%
$1.40B43.647.03%1.17%
57
Neutral
£134.22M24.654.79%2.67%1.74%359.50%
52
Neutral
£22.88M-5780.00%-8.06%-132.47%
46
Neutral
£44.62M29.30-0.04%3.93%0.03%-100.84%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:IQE
IQE plc
9.05
-18.60
-67.27%
OXINF
Oxford Instruments
24.96
-5.25
-17.38%
GB:CML
CML Microsystems
280.00
-0.89
-0.32%
GB:GHH
Gooch & Housego
495.00
37.33
8.16%
GB:NANO
Nanoco Group plc
12.65
3.65
40.56%
GB:NXQ
Quixant
73.50
-19.82
-21.24%

IQE plc Corporate Events

Regulatory Filings and Compliance
IQE plc Amends Total Voting Rights Announcement
Neutral
Aug 4, 2025

IQE plc has amended its ‘Total Voting Rights’ announcement, initially released on 1 August 2025. As of 31 July 2025, the company’s issued share capital consists of 976,688,331 ordinary shares, with 4,115 held in treasury, resulting in 976,684,216 shares with voting rights. Shareholders should use this figure for calculations related to the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Regulatory Filings and Compliance
IQE plc Announces Total Voting Rights Update
Neutral
Aug 1, 2025

IQE plc has announced its total voting rights as of 31 July 2025, with the company’s issued share capital consisting of 967,403,009 ordinary shares, of which 967,398,894 have voting rights. This figure is crucial for shareholders to determine the need to notify their interest or changes in interest under the Financial Conduct Authority’s Disclosure Guidance and Transparency Rules. This announcement provides clarity on shareholder voting rights, which is essential for maintaining transparency and compliance with regulatory requirements.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £20.00 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
IQE plc Issues Share Options to Executive Leadership
Neutral
Jul 1, 2025

IQE plc announced the issuance of nil cost share options to its Executive Chair, Mark Cubitt, and CEO, Jutta Meier, as part of the company’s Long Term Incentive Plan. This move reflects their increased responsibilities and workloads, with both executives opting to receive their pay adjustments as options, which will vest monthly but are not exercisable until 2026. This strategic decision aligns with IQE’s efforts to incentivize its leadership team and potentially enhance stakeholder value by tying compensation to the company’s long-term performance.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Business Operations and StrategyRegulatory Filings and Compliance
IQE plc Updates on Total Voting Rights and Share Option Plan
Neutral
Jun 30, 2025

IQE plc announced its total voting rights and block admission return as of 30 June 2025. The company’s issued share capital consists of 976,505,562 ordinary shares, with 976,501,447 shares having voting rights. This update is crucial for shareholders to determine their interest in the company under the Financial Conduct Authority’s rules. Additionally, during the period from 1 January 2025 to 30 June 2025, 9,254,445 ordinary shares were issued under the company’s all-employee share option plan, leaving a balance of 6,531,834 shares not yet issued. This update reflects the company’s ongoing commitment to its employee share scheme and provides transparency to its stakeholders.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Executive/Board ChangesShareholder MeetingsFinancial Disclosures
IQE plc Successfully Passes All Resolutions at 2025 AGM
Positive
Jun 30, 2025

IQE plc announced the successful passing of all resolutions at its 2025 Annual General Meeting held in London. The resolutions included the receipt of the Directors’ Report and Financial Statements, approval of the Directors’ Annual Report on Remuneration, and the election and re-election of several board members. The reappointment of the auditor and the directors’ authority to allot shares were also approved. The meeting’s outcomes reinforce IQE’s operational stability and governance, potentially strengthening its market position and stakeholder confidence.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Shareholder MeetingsBusiness Operations and Strategy
IQE plc Hosts Annual General Meeting in London
Neutral
Jun 30, 2025

IQE plc announced it will host its Annual General Meeting (AGM) today in London, with shareholders able to attend in person. The results of the AGM will be shared via the Regulatory News Service following the meeting, which is significant for stakeholders as it provides updates on the company’s strategic direction and operational performance.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £20.00 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Product-Related AnnouncementsBusiness Operations and Strategy
IQE and Quinas Technology Advance ULTRARAM™ Production
Positive
Jun 16, 2025

IQE plc and Quinas Technology have completed a £1.1 million project funded by Innovate UK to develop a scalable production method for ULTRARAM™, the world’s first quantum-powered universal memory. This project marks a significant step towards commercial production, with IQE achieving a world-first in scalable epitaxy for memory devices. ULTRARAM™ combines the non-volatility of flash memory with the speed and endurance of DRAM, offering improved energy efficiency. The project supports the UK Government’s semiconductor strategy, positioning the UK as a leader in next-generation memory innovation, with potential applications in AI, quantum computing, space, and defense.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Other
IQE plc Announces Change in Major Shareholder Holdings
Neutral
Jun 9, 2025

IQE plc has announced a change in its major holdings, with Canaccord Genuity Group Inc. reducing its voting rights in the company from 10.9929% to 9.9982%. This adjustment in holdings reflects a slight decrease in Canaccord’s influence over IQE’s corporate decisions, which could impact the company’s strategic direction and stakeholder interests.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
IQE plc Issues Share Options to Key Executives
Neutral
Jun 9, 2025

IQE plc announced the issuance of nil cost share options to its Executive Chair, Mark Cubitt, and CEO, Jutta Meier, under its Long Term Incentive Plan. Mark Cubitt received options over 166,667 ordinary shares, with plans for similar future grants, reflecting his increased time commitment and contributions during the strategic review. Jutta Meier was granted options over 5,666,667 ordinary shares, with vesting tied to financial and strategic performance targets. These grants aim to align the interests of key executives with shareholders, potentially impacting the company’s strategic direction and stakeholder confidence.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Shareholder MeetingsFinancial Disclosures
IQE plc Announces 2025 AGM Notice and 2024 Annual Report Release
Neutral
May 27, 2025

IQE plc has announced the publication of its 2025 Notice of Annual General Meeting (AGM) and its 2024 Annual Report and Accounts, both available on the company’s website. The AGM is scheduled for June 30, 2025, in London, where shareholders can vote and pose questions to the Board. This announcement underscores IQE’s commitment to transparency and shareholder engagement, potentially impacting its market positioning and stakeholder relations.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
IQE plc Reports Improved Profitability and Strategic Shift in 2024 Results
Positive
May 13, 2025

IQE plc announced its full-year 2024 financial results, showing improved profitability and a strategic shift in focus. The company reported a slight increase in revenue to £118.0m and a significant rise in adjusted EBITDA by 88% year-on-year, reflecting cost reduction efforts and operational optimizations. Despite challenges in the macroeconomic environment, IQE is progressing with a strategic review, including potential asset sales and an IPO, to strengthen its financial position. Jutta Meier has been appointed as the CEO, continuing her role as CFO, and will lead the company through its ongoing strategic initiatives.

The most recent analyst rating on (GB:IQE) stock is a Buy with a £0.45 price target. To see the full list of analyst forecasts on IQE plc stock, see the GB:IQE Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Aug 13, 2025