Cohu, Inc. (NASDAQ:COHU), a supplier of semiconductor test, handling, and inspection equipment, reported financial results for its fourth quarter and full fiscal year 2025 that fell short of analyst expectations, triggering a sharp negative reaction in after-hours trading.
Earnings and Revenue Miss
The company's Q4 results presented a mixed operational picture but ultimately disappointed on key financial metrics. Cohu reported quarterly net sales of $122.2 million, which represented a significant 30% increase from the $94.1 million reported in the same quarter last year. However, this figure came in below the analyst consensus estimate of approximately $124.5 million.
The earnings miss was more pronounced. On a non-GAAP basis, which excludes items like stock-based compensation and amortization, Cohu reported a net loss of $7.2 million, or a loss of $0.15 per share. This result was in stark contrast to the analyst expectation for a profit of $0.06 per share. The GAAP results were even weaker, showing a net loss of $22.5 million, or $0.48 per share.
Key financial results versus estimates:
- Q4 Revenue: $122.2 million reported vs. ~$124.5 million estimated (a miss)
- Q4 Non-GAAP EPS: Loss of $0.15 reported vs. profit of $0.06 estimated (a significant miss)
- Full-Year 2025 Revenue: $453.0 million (up from $401.8 million in FY2024)
- Full-Year Non-GAAP EPS: Loss of $0.22
Market Reaction and Price Action
The market's response to the earnings and guidance shortfall was immediate and severe. Following the release, Cohu's stock plummeted approximately 20.7% in after-market trading. This dramatic drop erases gains the stock had accrued over recent weeks, including a nearly 17% increase over the past month, indicating investors were caught off guard by the weaker-than-anticipated profitability and outlook.
Management Commentary and Outlook
In the press release, CEO Luis Müller highlighted positive business trends, stating, "Cohu delivered Q4 revenue of $122 million, up 30% year over year, supported by improving market fundamentals with estimated test cell utilization increasing to 76% in December." He also pointed to strong design-win momentum in areas like automotive ADAS and AI computing.
However, the company's forward guidance appears to have contributed to the negative sentiment. Cohu provided a sales outlook for the first quarter of fiscal 2026 in a range of $122 million, plus or minus $7 million. The midpoint of this range ($122 million) is essentially flat sequentially and falls below the current analyst consensus estimate of approximately $121.8 million for Q1 2026 sales. More notably, the implied profitability at this revenue level, given the Q4 cost structure, seems to have alarmed investors.
Financial Position and Summary
Despite the quarterly loss, Cohu strengthened its balance sheet significantly during the quarter. The company ended the period with $484.0 million in total cash and investments, up from $262.1 million at the end of 2024. This increase is primarily due to the issuance of $287.5 million in convertible senior notes in September 2025. The company also completed the acquisition of Tignis, Inc. in January 2025.
In summary, Cohu's Q4 report showed:
- Strong year-over-year revenue growth driven by improving semiconductor equipment demand.
- A significant miss on bottom-line profitability versus analyst expectations.
- A Q1 2026 revenue outlook that, at its midpoint, suggests stagnation and fails to provide confidence in a near-term return to profitability.
- A robust cash position following a convertible debt offering.
The severe after-hours sell-off reflects investor disappointment with the earnings miss and a cautious outlook that tempers optimism about the ongoing industry recovery. The market is signaling that top-line growth alone is insufficient without clearer progress toward sustained profitability.
For a detailed look at Cohu's historical earnings and future analyst estimates, you can review the data here.
Disclaimer: This article is for informational purposes only and does not constitute financial advice, an endorsement, or a recommendation to buy, sell, or hold any security. Investing involves risk, including the potential loss of principal.
