Shares dropped 8.8% as investors likely reacted to cautious commentary on operating expenses, lower other income, and rising costs despite revenue and gross margin improvements, signaling concerns over margin pressure and cash flow headwinds.
- Q2 revenue hit a record $717.5 million, up 26.8% year-on-year, driven by higher wafer shipments and improved average selling prices.
- Gross margin improved to 16.5%, increasing 5.6 percentage points year-on-year, supported by pricing gains and cost reductions but partially offset by rising depreciation.
- Operating expenses rose 11.4% year-on-year to $109.1 million, mainly due to increased labor costs.
- Other income declined sharply (down 79.4% year-on-year) due to higher finance costs and reduced government subsidies, dampening net profitability.
- Significant capital expenditures ($356.6 million) for capacity expansion strained cash flow, while financing activities reflected large bank loan repayments totaling $569 million.
Community Discussion