Magnachip Reports Results for Second Quarter 2026

Q2 Results Summary Consolidated revenue from continuing operations (which includes Power Analog Solutions (“PAS”) and Power IC (“PIC”) businesses) was $44.7 million, within the guidance range of $44.5 to $48.5 million. Consolidated gross profit margin from continuing operations of 19.3% was above the high end of our guidance range of 17.0% to 19.0%. Recent Highlights Appointment of Chae Lee as Chief Executive Officer Launches New 6th-Generation 600V SJ MOSFETs for AI Servers and EV Charging Applications Formed strategic partnership with Navitas Semiconductor to license SiC technology for use in high-voltage and ultra-high-voltage power markets SEOUL, South Korea--(BUSINESS WIRE)--Jul. 29, 2026-- Magnachip Semiconductor Corporation (NYSE: MX) (“Magnachip” or the “Company”) today announced financial results for the second quarter 2026. Chae Lee, Magnachip’s CEO said, “Our second quarter results underscore both the challenges and the opportunity ahead. Our strategic relationship with Navitas marks an important milestone toward our plan to rebuild Magnachip. As I have met with our employees and customers over the past month, I have become increasingly confident in the strength of Magnachip's technology, engineering talent and manufacturing capabilities. Building on the strategic transformation already underway, we are focused on developing more differentiated power semiconductor solutions, improving our execution, and positioning Magnachip to compete through advanced innovation. While this transformation will take time, I believe it will strengthen our competitive position and create greater long-term shareholder value." Q2 2026 Financial Highlights In thousands of U.S. dollars, except share data GAAP Q2 2026 Q1 2026 Q/Q change Q2 2025 Y/Y change Net Sales 44,704 46,208 down 3.3 % 47,622 down 6.1 % Power Analog Solutions 40,574 41,647 down 2.6 % 42,261 down 4.0 % Power IC 4,130 4,561 down 9.4 % 5,361 down 23.0 % Gross Profit Margin 19.3 % 15.6 % up 3.7 %pts 20.4 % down 1.1 %pts Power Analog Solutions 17.2 % 12.8 % up 4.4 %pts 18.2 % down 1.0 %pts Power IC 40.9 % 40.4 % up 0.5 %pts 37.4 % up 3.5 %pts Operating Loss (9,976 ) (7,170 ) down 39.1 % (6,598 ) down 51.2 % Income (Loss) from continuing operations (7,601 ) (4,697 ) down 61.8 % 9,203 down 182.6 % Basic Earnings (Loss) per Common Share (0.21 ) (0.13 ) down 61.5 % 0.26 down 180.8 % Diluted Earnings (Loss) per Common Share (0.21 ) (0.13 ) down 61.5 % 0.25 down 184.0 % In thousands of U.S. dollars, except share data Non-GAAP(1) Q2 2026 Q1 2026 Q/Q change Q2 2025 Y/Y change Adjusted Operating Loss (6,976 ) (6,527 ) down 6.9 % (4,776 ) down 46.1 % Adjusted EBITDA (4,219 ) (3,640 ) down 15.9 % (1,542 ) down 173.6 % Adjusted Loss (4,901 ) (4,073 ) down 20.3 % (1,978 ) down 147.8 % Adjusted Loss per Common Share—Diluted (0.13 ) (0.11 ) down 18.2 % (0.05 ) down 160.0 % (1) Management believes that non-GAAP financial measures, when viewed in conjunction with GAAP results, can provide a meaningful understanding of the factors and trends affecting our business and operations and assist in evaluating our core operating performance. However, such non-GAAP financial measures have limitations and should not be considered as a substitute for net loss or as a better indicator of our operating performance than measures that are presented in accordance with GAAP. A reconciliation of historical GAAP results to non-GAAP results is included in this press release. Q3 2026 Financial Guidance While actual results may vary, Magnachip currently expects the following: Consolidated revenue from continuing operations (which includes Power Analog Solutions and Power IC businesses) to be in the range of $41.5 million to $45.5 million, a decrease of 2.7% sequentially and a decrease of 5.2% year-over-year at the mid-point. This compares with $44.7 million in Q2 2026 and $45.9 million in Q3 2025. Consolidated gross profit margin from continuing operations to be in the range of 17% to 19%, compared with 19.3% in Q2 2026 and 18.6% in Q3 2025. The sequential decline is primarily due to an unfavorable product mix. Commenting on the third quarter guidance, Shinyoung Park, Chief Financial Officer, said, “We continue to see healthy demand for our Low Voltage BatteryFET product line for mobile products. Nevertheless, we expect third-quarter revenue to decline sequentially due to three near-term factors: packaging constraints in our supply chain that are limiting our ability to fully satisfy demand, lower-than-expected customer volumes in certain consumer applications, and an unfavorable product mix resulting from continued pricing pressure on our legacy products.” Q2 2026 Earnings Conference Call Magnachip will host a corresponding conference call at 2:00 p.m. PT / 5:00 p.m. ET on Wednesday, July 29, 2026, to discuss its financial results. In advance of the conference call, all participants must use the following link to complete the online registration process. Upon registering, each participant will receive access details for this event including the dial-in numbers, a PIN number, and an e-mail with detailed instructions to join the conference call. A live and archived webcast of the conference call and a copy of the earnings release will be accessible from the ‘Investors’ section of the Company’s website at www.magnachip.com. Online registration: https://register-conf.media-server.com/register/BIb70b5b5cb65045238d2757182fd0d278 Safe Harbor for Forward-Looking Statements Information in this press release regarding Magnachip’s forecasts, business outlook, expectations and beliefs are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These statements include expectations regarding our financial performance and business outlook, including third quarter 2026 revenue and gross profit margin, future growth and revenue opportunities, strategic relationships, product development and commercialization, and other future events. All forward-looking statements included in this release are based upon information available to Magnachip as of the date of this release. These statements are not guarantees of future performance and actual results could differ materially from our current expectations. Factors that could cause or contribute to such differences include, among others: changes in macroeconomic conditions, trade policies, geopolitical conditions and market conditions; manufacturing capacity constraints, supply chain disruptions and changes in customer demand; the impact of competitive products and pricing; our ability to establish, maintain and expand strategic relationships with customers and business partners, and to realize the anticipated benefits of those relationships; customer acceptance of our products and technologies; our ability to develop, introduce and ramp new products into volume production; changes in semiconductor industry supply and demand, including overcapacity and manufacturing utilization; financial stability in foreign markets and the impact of foreign exchange rates; unanticipated costs and expenses; changes in, or compliance with, applicable trade, export and other laws and regulations; public health issues; other business interruptions; and other risks described in Magnachip's filings with the SEC, including our Annual Report on Form 10-K filed on March 16, 2026. Magnachip assumes no obligation and does not intend to update the forward-looking statements provided, whether as a result of new information, future events or otherwise. About Magnachip Semiconductor Magnachip is a designer and manufacturer of analog and mixed-signal power semiconductor platform solutions for various applications, including industrial, automotive, communication, consumer and computing. The Company provides a broad range of standard products to customers worldwide. Magnachip, with about 45 years of operating history, owns a substantial number of registered patents and pending applications, and has extensive engineering, design and manufacturing process expertise. For more information, please visit www.magnachip.com. MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of U.S. dollars, except share data) (Unaudited) Three Months Ended Six Months Ended June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Net sales 44,704 46,208 47,622 90,912 92,344 Cost of sales 36,056 39,014 37,910 75,070 73,270 Gross profit 8,648 7,194 9,712 15,842 19,074 Gross profit as a percentage of net sales 19.3 % 15.6 % 20.4 % 17.4 % 20.7 % Operating expenses: Selling, general and administrative expenses 8,747 7,666 8,976 16,413 18,179 Research and development expenses 7,896 6,698 6,488 14,594 11,925 Other charges 1,981 — 846 1,981 846 Total operating expenses 18,624 14,364 16,310 32,988 30,950 Operating loss (9,976 ) (7,170 ) (6,598 ) (17,146 ) (11,876 ) Interest income 949 1,063 1,322 2,012 2,862 Interest expense (320 ) (373 ) (373 ) (693 ) (796 ) Foreign currency gain (loss), net (526 ) (115 ) 10,797 (641 ) 10,392 Other income (loss), net 286 (10 ) (83 ) 276 31 Income (Loss) from continuing operations before income tax benefit, net (9,587 ) (6,605 ) 5,065 (16,192 ) 613 Income tax benefit, net (1,986 ) (1,908 ) (4,138 ) (3,894 ) (4,539 ) Income (Loss) from continuing operations (7,601 ) (4,697 ) 9,203 (12,298 ) 5,152 Income (Loss) from discontinued operations, net of tax 2,786 50 (8,880 ) 2,836 (13,707 ) Net income (loss) $ (4,815 ) $ (4,647 ) $ 323 $ (9,462 ) $ (8,555 ) Basic earnings (loss) per common share— Continuing operations $ (0.21 ) $ (0.13 ) $ 0.26 $ (0.34 ) $ 0.14 Discontinuing operations 0.08 0.00 (0.25 ) 0.08 (0.37 ) Total $ (0.13 ) $ (0.13 ) $ 0.01 $ (0.26 ) $ (0.23 ) Diluted earnings (loss) per common share— Continuing operations $ (0.21 ) $ (0.13 ) $ 0.25 $ (0.34 ) $ 0.14 Discontinuing operations 0.08 0.00 (0.24 ) 0.08 (0.37 ) Total $ (0.13 ) $ (0.13 ) $ 0.01 $ (0.26 ) $ (0.23 ) Weighted average number of shares— Basic 36,454,812 36,407,581 36,083,703 36,431,327 36,483,551 Diluted 36,454,812 36,407,581 36,768,647 36,431,327 37,209,622 MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands of U.S. dollars, except share data) (Unaudited) June 30, 2026 December 31, 2025 Assets Current assets Cash and cash equivalents $ 87,936 $ 103,756 Accounts receivable, net 23,788 26,022 Inventories, net 34,136 34,151 Other receivables 4,096 2,882 Prepaid expenses 4,346 5,062 Hedge collateral 4,540 1,200 Other current assets 5,631 3,782 Total current assets 164,473 176,855 Property, plant and equipment, net 92,243 100,204 Operating lease right-of-use assets 1,423 2,070 Intangible assets, net 395 454 Long-term prepaid expenses 498 584 Deferred income taxes 60,217 64,248 Other non-current assets 5,602 7,114 Total assets $ 324,851 $ 351,529 Liabilities and Stockholders’ Equity Current liabilities Accounts payable $ 21,127 $ 20,848 Other accounts payable 5,690 11,444 Accrued expenses 7,696 6,929 Accrued income taxes 38 81 Operating lease liabilities 1,144 1,427 Current portion of long-term borrowings 25,949 — Other current liabilities 6,044 2,681 Total current liabilities 67,688 43,410 Long-term borrowings 15,566 44,599 Accrued severance benefits, net 11,908 11,502 Non-current operating lease liabilities 324 690 Other non-current liabilities 2,833 3,078 Total liabilities 98,319 103,279 Commitments and contingencies Stockholders’ equity Common stock, $0.01 par value, 150,000,000 shares authorized, 58,318,707 shares issued and 36,510,111 outstanding at June 30, 2026 and 58,027,696 shares issued and 36,219,100 outstanding at December 31, 2025 581 579 Additional paid-in capital 283,263 281,537 Retained earnings 205,390 214,852 Treasury stock, 21,808,596 shares at June 30, 2026 and 21,808,596 shares at December 31, 2025, respectively (229,910 ) (229,910 ) Accumulated other comprehensive loss (32,792 ) (18,808 ) Total stockholders’ equity 226,532 248,250 Total liabilities and stockholders’ equity $ 324,851 $ 351,529 MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands of U.S. dollars) (Unaudited) Three Months Ended Six Months Ended June 30, 2026 June 30, 2026 June 30, 2025 Cash flows from operating activities Net loss $ (4,815 ) $ (9,462 ) $ (8,555 ) Adjustments to reconcile net loss to net cash used in operating activities Depreciation and amortization 2,755 5,637 6,661 Provision for severance benefits 1,126 2,338 2,175 Loss (gain) on foreign currency, net 1,616 5,878 (18,085 ) Provision (reversal) for inventory reserves (903 ) (1,224 ) 845 Stock-based compensation 1,019 1,662 1,492 Impairment charges — — 7,362 Deferred income tax assets — 8 (649 ) Others, net 54 128 476 Changes in operating assets and liabilities Accounts receivable, net (593 ) 1,018 (4,600 ) Inventories (1,029 ) (1,220 ) (4,979 ) Other receivables 301 (1,246 ) (5,835 ) Prepaid expenses 1,532 1,380 4,621 Other current assets (1,157 ) (2,882 ) 675 Accounts payable 10 581 2,559 Other accounts payable (5,436 ) (5,690 ) (4,972 ) Accrued expenses 2,355 1,287 (2,022 ) Accrued income taxes (8 ) (41 ) 22 Other current liabilities (433 ) 160 (546 ) Other non-current liabilities 347 400 8 Payment of severance benefits (461 ) (689 ) (9,843 ) Others, net (782 ) (969 ) 3,389 Net cash used in operating activities (4,502 ) (2,946 ) (29,801 ) Cash flows from investing activities Proceeds from settlement of hedge collateral 4,334 4,334 2,237 Payment of hedge collateral (4,043 ) (7,828 ) — Purchase of property, plant and equipment (1,329 ) (5,244 ) (12,083 ) Payment for intellectual property registration (43 ) (67 ) (85 ) Collection of guarantee deposits 135 2,026 2,336 Payment of guarantee deposits — (158 ) (297 ) Others, net — 49 180 Net cash used in investing activities (946 ) (6,888 ) (7,712 ) Cash flows from financing activities Proceeds from long-term borrowings — — 6,964 Proceeds from issuance of common stock 66 66 — Acquisition of treasury stock (25 ) (201 ) (4,020 ) Repayment of financing related to water treatment facility arrangement (107 ) (217 ) (225 ) Repayment of principal portion of finance lease liabilities (32 ) (66 ) (80 ) Net cash provided by (used in) financing activities (98 ) (418 ) 2,639 Effect of exchange rates on cash and cash equivalents (1,072 ) (5,568 ) 9,590 Net decrease in cash and cash equivalents (6,618 ) (15,820 ) (25,284 ) Cash and cash equivalents Beginning of the period 94,554 103,756 138,610 End of the period $ 87,936 $ 87,936 $ 113,326 MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES RECONCILIATION OF OPERATING LOSS FROM CONTINUING OPERATIONS TO ADJUSTED OPERATING LOSS FROM CONTINUING OPERATIONS (In thousands of U.S. dollars) (Unaudited) Three Months Ended Six Months Ended June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Operating loss– continuing operations $ (9,976 ) $ (7,170 ) $ (6,598 ) $ (17,146 ) $ (11,876 ) Adjustments: Equity-based compensation expense 1,019 643 976 1,662 1,844 Other charges 1,981 — 846 1,981 846 Adjusted Operating Loss– continuing operations $ (6,976 ) $ (6,527 ) $ (4,776 ) $ (13,503 ) $ (9,186 ) We present Adjusted Operating Loss from continuing operations as a supplemental measure of our performance. We define Adjusted Operating Loss from continuing operations for the periods indicated as operating loss from continuing operations adjusted to exclude (i) Equity-based compensation expense and (ii) Other charges. For the three and six months ended June 30, 2026, we recorded $1,981 thousand of other charges, consisting of a $1,095 thousand customer goodwill payment related to a certain product, and $886 thousand of one-time employee incentives. For the same period in 2025, we recorded $496 thousand of one-time employee incentives and $350 thousand of certain executive separation benefit related accruals. MAGNACHIP SEMICONDUCTOR CORPORATION AND SUBSIDIARIES RECONCILIATION OF INCOME (LOSS) FROM CONTINUING OPERATIONS TO ADJUSTED EBITDA FROM CONTINUING OPERATIONS AND ADJUSTED LOSS FROM CONTINUING OPERATIONS (In thousands of U.S. dollars, except share data) (Unaudited) Three Months Ended Six Months Ended June 30, 2026 March 31, 2026 June 30, 2025 June 30, 2026 June 30, 2025 Income (Loss) from continuing operations $ (7,601 ) $ (4,697 ) $ 9,203 $ (12,298 ) $ 5,152 Adjustments: Interest income (949 ) (1,063 ) (1,322 ) (2,012 ) (2,862 ) Interest expense 320 373 373 693 796 Income tax benefit, net (1,986 ) (1,908 ) (4,138 ) (3,894 ) (4,539 ) Depreciation and amortization 2,750 2,877 3,237 5,627 6,357 EBITDA – continuing operations (7,466 ) (4,418 ) 7,353 (11,884 ) 4,904 Equity-based compensation expense 1,019 643 976 1,662 1,844 Foreign currency loss (gain), net 526 115 (10,797 ) 641 (10,392 ) Derivative valuation loss (gain), net (279 ) 20 80 (259 ) 51 Other charges 1,981 — 846 1,981 846 Adjusted EBITDA – continuing operations $ (4,219 ) $ (3,640 ) $ (1,542 ) $ (7,859 ) $ (2,747 ) Income (Loss) from continuing operations $ (7,601 ) $ (4,697 ) $ 9,203 $ (12,298 ) $ 5,152 Adjustments: Equity-based compensation expense 1,019 643 976 1,662 1,844 Foreign currency loss (gain), net 526 115 (10,797 ) 641 (10,392 ) Derivative valuation loss (gain), net (279 ) 20 80 (259 ) 51 Other charges 1,981 — 846 1,981 846 Income tax effect on non-GAAP adjustments (547 ) (154 ) (2,286 ) (701 ) (2,263 ) Adjusted Loss – continuing operations $ (4,901 ) $ (4,073 ) $ (1,978 ) $ (8,974 ) $ (4,762 ) Adjusted Loss – continuing operations per common share— - Basic $ (0.13 ) $ (0.11 ) $ (0.05 ) $ (0.25 ) $ (0.13 ) - Diluted $ (0.13 ) $ (0.11 ) $ (0.05 ) $ (0.25 ) $ (0.13 ) Weighted average number of shares – basic 36,454,812 36,407,581 36,083,703 36,431,327 36,483,551 Weighted average number of shares – diluted 36,454,812 36,407,581 36,083,703 36,431,327 36,483,551 We present Adjusted EBITDA from continuing operations and Adjusted Loss from continuing operations as supplemental measures of our performance. We define Adjusted EBITDA from continuing operations for the periods indicated as EBITDA – continuing operations (as defined below), adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net and (iv) Other charges. EBITDA – continuing operations for the periods indicated is defined as income (loss) from continuing operations before interest income, interest expense, income tax benefit, net and depreciation and amortization. We prepare Adjusted Loss from continuing operations by adjusting income (loss) from continuing operations to eliminate the impact of a number of non-cash expenses and other items that may be either one time or recurring that we do not consider to be indicative of our core ongoing operating performance. We believe that Adjusted Loss from continuing operations is particularly useful because it reflects the impact of our asset base and capital structure on our operating performance. We define Adjusted Loss from continuing operations for the periods as net loss, adjusted to exclude (i) Equity-based compensation expense, (ii) Foreign currency loss (gain), net, (iii) Derivative valuation loss (gain), net, (iv) Other charges and (v) Income tax effect on non-GAAP adjustments. For the three and six months ended June 30, 2026, we recorded $1,981 thousand of other charges, consisting of a $1,095 thousand customer goodwill payment related to a certain product, and $886 thousand of one-time employee incentives. For the same period in 2025, we recorded $496 thousand of one-time employee incentives and $350 thousand of certain executive separation benefit related accruals. View source version on businesswire.com: https://www.businesswire.com/news/home/20260729493522/en/ Mike Bishop Bishop IR, LLC Tel. +1 (415) 891-9633 [email protected] Source: Magnachip Semiconductor Corporation