By Rory Gallivan
LONDON--Shares in IQE PLC (IQE.LN) dived after the semiconductor
materials supplier said it expects to report a 17% drop in
first-half revenue, blaming weakness in the smartphone market.
The company, which supplies wafers to companies that make chips
used in Apple Inc (AAPL) iPhones and other wireless devices, said
it expects to report first-half revenue of 52 million pounds ($89
million). Analysts said this is short of their expectations but IQE
added it should meet its full-year expectations following a pick-up
in wireless demand in the second quarter.
Broker Peel Hunt said IQE's largest customer, the chip maker
Skyworks Solutions Inc. (SWKS), recently reported a strong June
quarter and raised its guidance for the current quarter.
It also pointed to IQE's diversification from the smartphone
market, with progress in areas such as solar power and optics.
IQE has a strong position in the supply of wafers containing the
chemical compound gallium arsenide, but chips using this material
are facing competition from silicon chips. Skyworks makes chips
based on both technologies.
The company has been seeking to reduce its reliance on
smartphones by selling its materials for chips used in solar panels
and devices with features such as gesture recognition.
Shares at 1016 GMT were down 3 pence, or 14.1%, at 20 pence,
valuing the company at GBP128 million.
-Write to Rory Gallivan at rory.gallivan@wsj.com; Twitter:
@RoryGallivan
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