Daqo New Energy Announces $100M Share Repurchase and Forecasts 110,000-130,000 MT 2025 Production Amid Regulatory Shifts.

Daqo New Energy Corp. plans to repurchase $100M worth of shares and forecasts 2025 production of 110,000-130,000 MT. CEO Xiang Xu discussed industry challenges, including price declines, overcapacity, and high inventory levels.

Daqo New Energy Corp. (DQ) has announced a $100 million share repurchase program, effective from Tuesday through December 31, 2026. The company expects to fund this repurchase primarily through its existing cash balance. This announcement comes amidst challenging market conditions for the solar PV industry, where Daqo New Energy is experiencing price declines, overcapacity, and high inventory levels.

During the company's Q2 2025 earnings call, CEO Xiang Xu discussed the persistent challenges in the solar PV industry. He cited continued price declines across the value chain, overcapacity, and high inventory levels as key issues. Despite these challenges, the company maintained a strong and healthy balance sheet with no financial debt. As of June 30, 2025, Daqo New Energy had a cash balance of $599 million, short-term investments of $419 million, bank notes receivables of $49 million, and a total fixed term bank deposit balance of $994 million.

The company's Q2 2025 financial results showed a gross loss of $81.4 million and a net loss of $76.5 million. Gross margin declined further to negative 108% from negative 65.8% in Q1, while operating loss was reported at $115 million with an operating margin of negative 153%. The company's adjusted net loss was $57.9 million, with adjusted loss per basic ADS at $0.86. EBITDA was negative $48 million.

Daqo New Energy expects total polysilicon production volume in Q3 2025 to be approximately 27,000 to 30,000 metric tonnes and for full year 2025 between 110,000 and 130,000 metric tonnes. The company's strategic focus for the remainder of the year will be on aggressive inventory management, participation in policy-driven industry consolidation, and capital return through the share repurchase program.

The share repurchase program is seen as a move to strengthen shareholder confidence. The company's CFO, Ming Yang, stated that the buyback is the first move to boost market confidence. The company also signaled that future sales strategy and utilization rates will be closely tied to how new government regulations and industry consolidation initiatives are implemented in the coming months.

While the company faces ongoing risks such as overcapacity, low selling prices below cash cost, and high industry inventory, management is maintaining a proactive approach. This includes maintaining reduced utilization, dynamic sales strategies, hedging through futures markets, and leveraging financial strength.

References:
[1] https://seekingalpha.com/news/4489136-daqo-new-energy-announces-100m-share-repurchase-program
[2] https://seekingalpha.com/news/4489360-daqo-new-energy-outlines-100m-share-repurchase-and-forecasts-110000-130000-mt-2025-production