Company Performance#
Daqo New Energy Corp ADR faced a tough first quarter in 2026, reporting earnings per share (EPS) of -$1.31. This figure was much worse than the expected EPS of -$0.35, indicating a significant loss. The company also reported revenue of $26.7 million, which fell far short of the anticipated $166.93 million. This disappointing performance led to a 16.17% drop in the company’s stock during premarket trading, raising concerns among investors about its financial stability and the challenging market conditions.
Financial Highlights#
In detail, Daqo’s revenue saw a staggering decline of 87.9% from the previous quarter and 78.5% year-over-year. The gross margin, which measures the difference between revenue and the cost of goods sold, was a negative 521%, a sharp drop from the 7% reported in the previous quarter. Additionally, the company recorded an operating loss of CNY 150.8 million, compared to a loss of CNY 20.9 million in Q4 2025. These figures highlight the severity of the company’s financial struggles.
Earnings vs. Forecast#
The actual EPS of -$1.31 represented a negative surprise of 274.29% compared to the forecast. Similarly, the revenue of $26.7 million was 84.01% below expectations, reflecting the challenges Daqo faced in the polysilicon market, which is crucial for solar energy production. The company cited reduced sales volumes and significant inventory impairment charges as key factors contributing to these disappointing results.
Outlook & Guidance#
Looking forward, Daqo New Energy has provided guidance for Q2 2026, expecting to produce between 35,000 and 40,000 metric tons of polysilicon. The company aims to maintain a utilization rate of 50-55%, depending on government policies regarding pricing. Despite the current challenges, Daqo is focusing on improving its technology and efficiency in polysilicon production.