Ichor Holdings 2025 Q2 Earnings Misses Targets as Net Loss Widens 84%

Ichor Holdings (ICHR) reported Q2 2025 earnings on August 6, 2025, with revenue up 18.2% to $240.28 million, but the company posted a wider-than-expected net loss of $9.41 million, or $0.28 per share. Management attributed the shortfall to hiring and retention challenges in U.S. operations, which constrained production and gross margin expansion. Guidance for Q3 was issued with a cautious outlook, reflecting ongoing labor and operational uncertainties.

Revenue

Ichor Holdings reported total revenue of $240.28 million for Q2 2025, a 18.2% increase from $203.23 million in the same period last year. This growth outpaced the previous quarter’s $240.3 million result, though sequential revenue declined by 2%. The increase was driven by higher demand in lower gas panel integration and other core manufacturing segments. CEO Jeff Andresen highlighted that the company is working to scale internal component supply to meet customer demand and reduce reliance on external sourcing, a key factor in future margin improvement.

Earnings/Net Income

Ichor Holdings posted a net loss of $9.41 million in Q2 2025, representing a 84.0% increase from the $5.11 million loss in Q2 2024. On a per-share basis, the loss widened to $0.28 from $0.15 a year ago. The company’s non-GAAP EPS was $0.03, negatively impacted by a $3.2 million tax expense acceleration in Q2, which was higher than forecast. Despite a 10-basis-point sequential improvement in gross margin to 12.5%, ongoing hiring challenges and higher operating expenses limited profitability.

Price Action

The stock price of Ichor Holdings has declined significantly following earnings. Over the past trading day, the stock fell 0.50%, while over the last full trading week, it plummeted 33.02%. Month-to-date, the stock has dropped 38.12%, reflecting investor concerns over the widening losses and operational challenges.

Post Earnings Price Action Review

The strategy of buying Ichor Holdings’ stock following an earnings beat and selling after 30 days delivered a 29.98% return, underperforming the benchmark’s 83.32% gain. The Sharpe ratio of 0.22 suggests moderate risk-adjusted returns, although the maximum drawdown of 0% indicates the strategy avoided losses but failed to capitalize on broader market gains. Analysts noted that the mixed performance highlights the challenges of timing trades in a volatile sector.

CEO Commentary

CEO Jeff Andresen outlined Q2 2025 business performance, emphasizing the need to ramp internal component supply and align production with customer demand. He acknowledged that hiring and retention challenges in the U.S. machining operation limited output and gross margin expansion. Despite these issues, Andresen highlighted progress in new product qualifications, including the first end-user approval for a flow control product and production shipments for valves. These developments are expected to drive future margin improvement.

Guidance

For Q3 2025, Ichor Holdings guided revenue to a range of $225–245 million, with non-GAAP gross margin expected between 12.5% and 13.5%. Non-GAAP operating expenses are projected to remain at approximately $23.7 million, while non-GAAP EPS is expected to range between $0.06 and $0.18. The company anticipates sequential gross margin improvement in Q4 but remains cautious until Q3 performance is confirmed. Full-year 2025 non-GAAP tax expense is forecasted at $5.6 million, with capital expenditures planned at around 4% of revenue.

Additional News

Recent developments include Ichor Holdings’ CEO succession plan, with Jeff Andresen remaining until a successor is named before transitioning to a strategic adviser role. The company also highlighted significant progress in product qualification, including the first end-user approval for a flow control product and the initiation of valve production shipments. Management noted that ongoing hiring challenges continue to impact internal supply ramp-up, which is essential for realizing higher margins. Additionally, the company confirmed its long-term goal of achieving 20% non-GAAP gross margin, contingent on successful product development and cost alignment.

Ichor Holdings is also navigating the implications of Section 232 tariffs on steel and aluminum, which it passes through to customers. Recent regulatory clarifications have improved understanding of the tariffs’ impact, which is now better defined based on weight and non-U.S. source materials. Management stated that it is actively working to reduce the financial impact of these tariffs across its supply chain.

The company has also announced restructuring charges related to exit costs for personnel, fixed assets, and facility-related expenses across Q1 and Q2 2025. These charges, totaling $5.7 million under GAAP, may continue in Q3 and Q4 as operations consolidate. Despite these challenges, Ichor Holdings remains confident in its ability to scale proprietary component production and expand its addressable markets through next-generation offerings in flow control and valve technologies.