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UK's IQE issues second revenue warning in 5 months

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(Reuters) – IQE Plc <IQE.L> said on Monday it expects to report a “mid-single digit” adjusted operating loss as the Cardiff-based firm warned on annual revenue for a second time in less than five months, as issues with two of its major customers weighed.

The company had said in June it would miss its 2019 revenue forecast due to a bigger-than-expected hit on the industry’s supply chain from U.S. restrictions on China’s Huawei [HWT.UL].

IQE, which makes semiconductor wafers for chips used in Apple Inc <AAPL.O> products, also manufactures for Asian customers in Taiwan and Singapore.

Shares of IQE were seen down 10%-20%, according to premarket indicators.

IQE has experienced very challenging market conditions in 2019. Shortfalls in revenue relate predominantly to two major customers,” the company said in a statement, without disclosing the names of the two customers.

IQE also said its outlook for 2020 includes a seasonally weak first quarter for 2020 and continued supply chain transitions in the wireless market. The company, however, takes a more “cautiously optimistic” stance beyond the first quarter.

The company expects a revenue between 136 million pounds ($174.03 million) and 142 million pounds for 2019, down from an earlier forecast of 140 million-160 million pounds. It reported a revenue of 156.3 million pounds in 2018.

(Reporting by Yadarisa Shabong in Bengaluru; Editing by Shailesh Kuber and Sherry Jacob-Phillips)

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