Alchip Technologies (3661) Q4 2025 earnings summary

Executive summary

• Q4 2025 revenue was $152.7M, down 31.5% quarter-on-quarter and 32.2% year-on-year, with net income of $47.9M and EPS of NT$18.3, the highest quarterly EPS for the year.

• Full-year 2025 revenue was $991.9M, a 39–40% year-on-year decline, with net income down 11% to $179.5M and EPS at NT$69.2.

• Revenue decline was mainly due to missing a product generation from the top customer and limited production shipments, but the relationship was regained and new production is set to ramp in Q2 2026.

• Gross margin improved year-over-year, reaching 42% in Q4 2025 due to a stronger NRE business mix.

• The company expects significant revenue growth in 2026, with 80% of annual revenue concentrated in the second half as 3nm accelerator shipments begin.

Financial highlights

• Q4 operating income was $39.1M, up 1% sequentially but down 27.9% year-on-year.

• Q4 gross margin reached 42%, making it the most profitable quarter of 2025 despite weak sales.

• For 2025, operating income was $160.9M (down 20% YoY), net income $179.5M (down 11% YoY).

• HPC/AI revenue accounted for 67% of Q4 and 83% of full-year revenue.

• Cash and cash equivalents increased to NT$32,627 million (US$1,038 million) at year-end 2025.

Outlook and guidance

• Q1 2026 revenue and P&L expected to be similar to Q4 2025, with low production revenue and seasonally weak NRE.

• Strong ramp in revenue anticipated from Q2 2026 as 3nm AI accelerator production starts.

• Multiple 2nm projects expected to begin in 2026, with the most important 2nm accelerator to tape out by year-end.

• Gross margin in Q1 2026 expected to remain high, with Q2 margin lower but still above Q3 2025 levels.

• The board proposed a 2025 cash dividend of NT$34.41 per share (US$1.086), pending shareholder approval.