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Shares of IQE plc (LON: IQE) plunged 13.7% after releasing disappointing financial results for the past six months of the year ended 30 June 2021.
The company, which manufactures semiconductor wafer products, generated revenues worth £79.5 million in H1 2021, an 11.5% decline compared to the £89.9 million generated in a similar period last year.
IQE also faced significant fluctuations in the foreign currency exchange markets, given that most of its income is generated in US dollars. The FX transactions variations cost the company an estimated £8.1 million.
The company’s gross profits came in at £11.6 million compared to the £16.3 million recorded in H1 2020.
Today’s figures paled in comparison to last year’s figures despite the impact of the coronavirus pandemic.
IQE recorded 30% year-on-year growth in its sustained wireless handset growth driven by strong demand for epi wafers used to amplify power in 5G handsets.
The company diversified its income from 5G infrastructure and other opportunities such as its wireless business, which experienced a 30% increase in GaAs revenues on an annualised basis on a constant currency basis.
However, a 53% drop in revenues generated from its GaN on SiC for 5G infrastructure reflected global changes in the 5G deployment cycles.
All in all, investors were disappointed to see the company make a £1.9 million operating loss compared to the £5 million loss registered last year. Despite reporting a smaller loss for the half-year period, IQE reported a significant drop in its revenues.
Dr Drew Nelson, IQE’s outgoing CEO, said: “Today’s results reflect the resilience of our business and highlight the ongoing commitment and hard work of our people who have, despite additional headwinds, largely sustained the record levels of performance at IQE that we reported a year ago.”
IQE share price.
IQE shares plunged 13.76% to trade at 46.14, falling from Monday’s closing price of 53.50p.
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