GCT Semiconductor (GCTS) Q2 2026 earnings summary

Executive summary

• 5G chipset shipments in Q2 2026 increased 71% sequentially to over 5,100 units, reflecting strong customer engagement and demand across terrestrial broadband, satellite, and IoT markets.

• Net revenues for Q2 2026 were $1.0 million, down 18% year-over-year, as the business shifted from 4G to 5G products and services.

• Gross margin turned negative for Q2 2026, primarily due to higher 5G production costs and lower service revenue.

• Net loss increased to $20.4 million from $13.5 million year-over-year, driven by a $12.3 million non-cash warrant liability loss.

• Expanded into new verticals, including UAV/defense, through strategic collaborations and new customer signings.

Financial highlights

• Q2 2026 product revenue was $0.4 million, flat year-over-year, while service revenue fell 26% to $0.6 million.

• Cost of net revenues rose 49% year-over-year to $1.2 million, mainly due to higher 5G manufacturing and depreciation.

• Operating expenses decreased 10% to $7.2 million, with R&D and G&A both down year-over-year.

• Adjusted EBITDA loss improved slightly to $6.6 million from $6.7 million year-over-year.

• Gross profit swung to a loss of $0.2 million from a $0.4 million profit in Q2 2025.

Outlook and guidance

• Aggregate 5G chipset shipments in the second half of 2026 are expected to exceed first-half levels as commercialization accelerates.

• Production capacity and wafer supply are secured through Q1 2027 to support anticipated demand.

• Ongoing investments in 5G production and R&D are expected to drive future revenue and margin improvement.

• Focus remains on disciplined capital allocation and converting pipeline into sustainable long-term revenue growth.

• The company remains dependent on additional fundraising and positive cash flow generation to sustain operations.