GCT Semiconductor Holding, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net revenues for the quarter ended September 30, 2026, were $1.1 million, representing a 148.6% increase from $0.4 million in the same period in 2025.
• Gross margin was negative for the quarter due to low product revenue insufficient to absorb production overhead costs; gross margin was also negative in Q3 2025.
• Total operating expenses were $7.3 million, an 11.2% decrease from $8.2 million in Q3 2025.
• Net loss was $7.4 million, a 46.7% decrease from $13.8 million in Q3 2025; this figure included $6.2 million in gains from the change in fair value of common stock warrant liabilities and $5.4 million in losses on foreign currency transactions.
• Adjusted EBITDA loss was $6.5 million, an 8.1% decrease from $7.0 million in Q3 2025.
• Cash and cash equivalents totaled $17.2 million as of September 30, 2026, up from $590,000 as of December 31, 2025.
• Net cash used in operating activities decreased from $16.6 million in Q2 2026 to $8.5 million in Q3 2026.
• Total liabilities were $97.2 million as of September 30, 2026, compared to $98.9 million as of December 31, 2025.
• Borrowings decreased to $52.4 million from $56.6 million at the end of 2025.
• Warrant liabilities increased to $12.1 million from $2.9 million at the end of 2025.

Guidance and Future Outlook:

• The ramp in 5G shipments is now expected to extend into the first half of 2027 due to customers taking longer than originally expected to implement chipsets and convert development programs into purchase orders.
• Management expects gross margins to improve as 5G product sales ramp up and contribute more significantly to revenue.
• The Company has secured wafer capacity sufficient to support expected demand through the first half of 2027.
• Priorities for the remainder of 2026 include maintaining a disciplined cost structure and aligning production investments with customer demand.

Business Segments and Product Lines:

• Shipped more than 3,200 5G chipsets in Q3 2026, bringing year-to-date shipments to over 11,300 units.
• A new potential 5G customer, a leader in next-generation geolocation solutions, received the majority of Q3 5G chipset shipments for proof-of-concept testing of precise 3D location capabilities indoors, in urban canyons, and in jammed environments.
• Continued progress on a program with one of the world's largest satellite communications providers to develop next-generation user equipment for high-bandwidth communications across satellite and terrestrial networks.
• Advanced ongoing terrestrial 5G development and integration work with a leading global telecom equipment supplier, delivering additional 5G chipsets during the third quarter.
• Revenue growth was driven by sustained product sales including 5G as customers advanced programs toward launch.

Market and Competitive Landscape:

• Expanded the total addressable market (TAM) to include terrestrial-based location services to augment or replace GNSS (GPS).
• Customer programs remain in active development, and the Company expanded its customer base in the third quarter.
• No customers have been lost due to extended implementation timelines.

Risks and Challenges:

• Shipment volumes in the quarter reflected extended timing of customer deployments rather than the full potential of 5G programs.
• Some customer programs are taking longer than planned to reach production and deployment.
• Forward-looking statements are subject to risks including the ability to develop 5G products, generate revenue, meet partnership obligations, manage growth, and obtain additional financing.
• Risks include component shortages, supplier capacity constraints, macroeconomic conditions, trade barriers, and the risk of not being able to repay debt.

Management Commentary and Tone:

• CEO John Schlaefer stated that 5G chipsets are being deployed beyond broadband and satellite connectivity into a broader addressable market, noting that the ramp pace is driven by customer integration schedules rather than chipset capabilities.
• CFO Edmond Cheng highlighted that revenue increased approximately 149% year-over-year and that cost reductions, combined with the current cash position, prepare the company for future customer deployments.
• Management expressed confidence in securing wafer capacity and maintaining a disciplined cost structure while awaiting volume ramp.

Other Key Points:

• GCT extended the maturities of $26.5 million of loans by one year during the quarter ended September 30, 2026.
• The Company has an effective universal shelf registration statement on Form S-3 allowing it to raise up to $200.0 million, including $120.0 million for an at-the-market (ATM) agreement.
• Liquidity sources as of September 30, 2026, included $17.2 million in cash, $0.5 million in net accounts receivable, and $3.3 million in inventory.
• A conference call and live webcast were scheduled for November 12, 2026, at 4:30 p.m. ET.