Key Highlights

  • ICHR reported third quarter 2026 Revenue of $328.7 million, up 12% from the second quarter and 37% from a year earlier.
  • GAAP gross Margin reached 15.8%, versus 13.9% in the second quarter and 4.6% a year earlier.
  • GAAP diluted EPS was $0.55 and non-GAAP diluted EPS was $0.63, compared with a non-GAAP loss of $0.42 a year ago.
  • Operations used $28.8 million of cash in the quarter as inventory rose $39.5 million and receivables rose $36.0 million.
  • Fourth quarter revenue is guided to $345 million to $365 million, with non-GAAP EPS of $0.65 to $0.75.

Ichor Revenue Climbs 37% as Gross Margin Reaches 15.8%

Ichor Holdings (NASDAQ:ICHR) reported third quarter 2026 results on Nov 2, 2026, for the quarter ended Sep 25, 2026. Revenue was $328.7 million, up 12% from $294.8 million in the second quarter and up 37% from $239.3 million a year earlier.

Ichor designs, engineers and manufactures critical fluid delivery subsystems and components for semiconductor Capital equipment. GAAP gross margin was 15.8% and non-GAAP gross margin was 16.0%, up from 4.6% and 5.1% in the third quarter of 2025. Management said the 16% level arrived a quarter ahead of plan, with incremental gross margin of 33% against an expected 25% to 30%.

GAAP Operating Margin was 6.9%, against a negative 8.1% a year earlier. Non-GAAP operating margin was 8.6%, up from 5.5% in the second quarter.

Earnings Swing to $20.9 Million While Inventory and Receivables Absorb Cash

GAAP Net Income was $20.9 million, or $0.55 per diluted share, compared with $1.0 million, or $0.03, in the second quarter and a loss of $22.9 million, or $0.67, a year ago. Non-GAAP net income was $24.2 million, or $0.63 per diluted share. Adjusted EBITDA was $33.9 million, according to management.

Cash used in Operating Activities was $28.8 million. Inventory rose by $39.5 million and Accounts Receivable by $36.0 million, which management tied to the revenue ramp, with inventory turns of 3.6 and receivables outstanding of 39 days similar to the prior quarter. Capital expenditures were $10.7 million.

Cash and equivalents ended at $213.5 million, down $43.0 million from the second quarter but up $115.2 million from the end of 2025, helped by $195.4 million of net proceeds from issuing 2.5 million ordinary shares. Total Debt was $119 million and the net debt coverage ratio was 0.8.

Proprietary Content Passes 30% as Supply Limits Shift the Product Mix

Management said supply constraints in high-end etch and deposition tools led it to emphasize components, which carry lower selling prices than full systems but a stronger Earnings contribution per revenue dollar. It won component programs on six new tool platforms outside the gas panel. Proprietary content in its gas systems exited the quarter above 30%, compared with 25% in the second quarter, with about 35% targeted by the end of the fourth quarter.

The footprint shift continued, with all planned moves to Mexico complete and Malaysia machining and welding qualified by both of the largest customers. Manufacturing headcount is up 40% this year, including 320 hires in the third quarter,. Management said it expects every quarter of 2027 to deliver sequential growth.

Fourth Quarter Outlook Calls for Revenue of $345 Million to $365 Million

For the fourth quarter, Ichor expects revenue of $345 million to $365 million, GAAP diluted EPS of $0.50 to $0.60 and non-GAAP diluted EPS of $0.65 to $0.75. Gross margin is guided to about 16.5%, plus or minus 0.5 points. At the midpoint, full-year 2026 revenue growth is roughly 30%.