IQE has reported a 43% increase in first-half revenue and returned to positive adjusted EBITDA as demand from artificial-intelligence infrastructure, defence, sensing, and wireless markets lifted the Cardiff-based semiconductor materials group.
Revenue reached £64.6m in the six months to 30 June, up from £45.3m a year earlier. Adjusted EBITDA was £6m, compared with a £0.4m loss in the first half of 2025.
The group also announced plans to transfer its listing from AIM to the Main Market of the London Stock Exchange during the first half of 2027, arguing that the move should broaden its institutional investor base, improve liquidity, and support potential inclusion in FTSE indices.
IQE remained loss-making at the pre-tax level, although the deficit narrowed. Its adjusted loss before tax reduced to £8.2m from £16m, while the reported loss before tax fell to £12.6m from £18.3m.
Chief executive Jutta Meier said the company had seen “more than 40% revenue growth year-on-year across our core markets driving profitability.”
Photonics was the strongest area of expansion. Revenue from the division rose 45% to £38.5m, supported by funding releases for US military and defence programmes as well as demand related to AI and data-centre infrastructure.
Wireless revenue increased 40% to £26m, reflecting market-share gains and sales into newly qualified customer platforms.
Compound semiconductor materials sit upstream of several fast-growing electronics markets. IQE manufactures advanced wafers used where conventional silicon is not always sufficient, including optical communications, radio-frequency devices, sensing, and power applications.
Growth in AI data centres has increased demand for high-speed optical links capable of moving large amounts of data between processors, servers, and storage equipment.
IQE said it sees further potential in optical communications and is converting existing capacity during the second half to support increasing demand for indium phosphide products.
Defence programmes are also contributing more semiconductor demand as governments increase spending on sensing, communications, radar, and advanced electronic systems.
The spread of demand across defence, data centres, and communications gives IQE a more diversified customer base than reliance on consumer wireless devices alone.
The balance sheet also changed substantially over the year. IQE reported adjusted net cash of £30.2m at the end of the first half, compared with adjusted net debt of £23.5m in the corresponding period of 2025. Cash and cash equivalents increased to £41.6m from £17m.
That provides greater room to invest in capacity and product development, although continuing reported losses show that the improvement in revenue and EBITDA has not yet translated into full bottom-line profitability.
Management said first-half trading exceeded expectations and momentum had continued into the second half. IQE is maintaining guidance for full-year revenue growth above 30%, with adjusted EBITDA expected to reach the low-teens millions of pounds.
The proposed Main Market transfer adds a capital-markets element to the operating recovery.
AIM has historically provided growth companies with access to public capital under a lighter regulatory structure, while the Main Market generally offers greater visibility among larger institutions and index-linked investors.
For IQE, the issue is no longer simply access to public markets. The company is examining whether a larger listing venue can broaden ownership and improve liquidity as its semiconductor markets expand.
The decision also lands amid increasing strategic attention on semiconductor supply chains. Advanced chip production is highly international, and governments in the UK, US, Europe, and Asia have been investing in domestic capability and supply security.
IQE said it is expanding its network of US foundry partners, including work intended to broaden geographic reach and strengthen supply chains for selected technology nodes.
That adds another commercial opportunity but also exposes the business to the investment cycles of customers whose own markets can be volatile. Data-centre expenditure, defence procurement, wireless demand, and semiconductor inventories do not necessarily move in parallel.
The stronger cash position gives IQE more flexibility to respond to those cycles than it had a year earlier.
Second-half delivery will determine whether the revenue acceleration produces the earnings improvement implied by management’s guidance. The proposed 2027 Main Market transfer will then test whether stronger operating performance can translate into deeper institutional participation in the shares.
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