Novatek Microelectronics (3034) Q4 2025 earnings summary

Executive summary

• Full-year 2025 consolidated revenue was TWD 100.7 billion (NT$100,663 million), down 2.1% year-over-year, with net income at TWD 16.35 billion (NT$16,348 million), a 19.6% decrease from 2024.

• Q4 2025 revenue was TWD 22.8 billion (NT$22.82 billion), down 7% quarter-over-quarter and 10% year-over-year, but at the high end of guidance.

• Q4 net income reached TWD 3.69 billion, up 1% sequentially but down from TWD 4.08 billion a year ago.

• Gross margin for Q4 was 38.2%, up sequentially but down from 39.5% YoY; full-year 2025 gross margin was 37.7%, down from 40.3% in 2024.

• The company maintained a strong cash position with NT$42.42 billion at year-end 2025.

Financial highlights

• Q4 gross profit was TWD 8.7 billion, down 32% quarter-over-quarter and 13% year-over-year.

• Q4 operating income was TWD 3.86 billion, with an operating margin of 16.92%, down year-over-year but improved sequentially.

• Q4 EPS was TWD 6.07, up from TWD 6.01 in Q3 but down from TWD 7.89 a year ago; full-year 2025 EPS was NT$26.87, down from NT$33.43 in 2024.

• Net cash at year-end 2025 was NT$42.42 billion, up NT$2.76 billion from Q3 2025.

• Inventory at year-end 2025 was NT$8.64 billion, down NT$0.56 billion from Q3 2025.

Outlook and guidance

• Q1 2026 revenue expected between TWD 22.2 billion and TWD 23.2 billion, with gross margin of 36%-39% and operating margin of 15%-18%.

• Tax rate guidance for 2026 is 16%-17%, similar to 2025.

• OpEx expected to grow slightly in 2026 due to increased R&D and talent investment.

• Early 2026 sales continued to fall, with January revenue down 10% year-over-year.

• New product launches in OLED TDDI, imaging, and machine vision expected to drive 2026 growth.