PLAB Earnings Summary — Q2 2026

• Revenue declined by 0.5% YoY to $209.9 million, marks a sequential drop from $225.1 million in Q1.
• Operating income fell to $42.2 million from $55.7 million in the same quarter last year, reflecting rising costs.
• Cost of revenue increased YoY to $144.2 million from $133.1 million, compressing gross margins significantly.
• Net income to common shareholders rose YoY to $31.4 million compared to $8.9 million in Q2 2025, largely due to extremely unfavorable non-operating expenses in the prior year period.
• Operating margins contracted to 20.1%, down from 26.4% in the year-ago quarter.
• Photronics maintains a strong balance sheet with substantial interest income of $3.8 million for the quarter.
• The company continues to operate with a zero-dividend policy, focusing on capital reinvestment and share stability.

Management remains focused on the transition from commoditized supplier to technology-leading partner for high-end logic and memory masks. Guidance emphasizes capacity utilization and technology mix as primary profitability drivers across semiconductor cycles.

Deteriorating

The shift from revenue growth in Q1 to a YoY contraction in Q2, combined with significant operating margin compression, indicates a cooling demand environment or rising cost pressures.

Photronics expects to benefit from long-term chip complexity trends at nodes 28nm and below, though quarterly volatility in the Flat Panel Display (FPD) segment and global trade regulations remain significant risk factors.