Ichor Holdings (4IH) Q2 2026 Earnings Report

The call conveys a strongly positive operational and financial momentum: sequential revenue and margin expansion, record quarterly earnings in three years, robust guidance for Q3 and full-year growth aligned with the high end of industry WFE expectations, strengthened liquidity from a completed $200M ATM, and a clear plan to ramp internal proprietary content and factory capacity (Malaysia qualifications and capacity targets up to ~$3B annually). Near-term headwinds are manageable and largely executional: an isolated parts shortage delayed recognition of some Q2 revenue by days, short-term negative operating cash flow from inventory build to support growth, ongoing supplier exposure (notably flow control), and dilution from the equity raise. Overall, positives materially outweigh the negatives and the tone is confident about sustaining stronger growth and margin expansion into 2H2026 and 2027.

Management guided Q3 revenue of $315–$345 million (midpoint ≈12% sequential growth, ≈38% YoY) with gross margin of 14.5%–15.5% and an expected ~100 basis points of gross margin improvement per quarter through year‑end, supporting Q3 EPS of $0.40–$0.50 (assumes ~$1.5M interest/other, a 20–25% tax rate and ~38.5M diluted shares); they reiterated 2026 revenue growth at the high end of WFE expectations (at least +30% vs. 2025), expect second‑half volumes to be ≥25% higher than the first half, see OpEx roughly $25.5M per quarter (total 2026 OpEx ≈+6% vs. 2025), expect CapEx to trend higher in H2 but near ~3% of revenue, and emphasized balance‑sheet flexibility after Q2 cash of $256M and completion of a $200M ATM (2,480,000 shares at $80.70 avg, net proceeds ≈$195M); other quarter metrics noted: Q2 revenue ≈$295M, Q2 gross margin 14.1%, Q2 EPS $0.34, EBITDA >$21M (up >50% sequentially), DSOs 32 days, inventory turns 3.7x, total debt $120.6M, net debt coverage 1.1, and current capacity to support $500M quarterly with potential to scale to >$3B annually with targeted investments.