Daqo New Energy (NYSE:DQ) Q4 2025 Earnings call February 26, 2026 08:00 AM ET Company ParticipantsAlan Han - Equity ResearchAnita Xu - Deputy CEOGordon Johnson - CEO and FounderJesse Zhao - Director of Investor RelationsMing Yang - CFOConference Call ParticipantsEmmett Lau - AnalystPhilip Shen - Managing Director and Senior Research AnalystNone - AnalystModeratorGood day, welcome to the Daqo New Energy New fourth quarter 2025 results conference call. All participants will be in a listen-only mode. Should yo ...

Daqo New Energy (NYSE:DQ) Q4 2025 Earnings call February 26, 2026 08:00 AM ET Company ParticipantsAnita Xu - Deputy CEOGordon Johnson - CEO and FounderJesse Zhao - Director of Investor RelationsMing Yang - CFOConference Call ParticipantsAlan Han - Investment Banking AnalystEmmett Lau - AnalystMan Win - AnalystPhilip Shen - Managing Director and Senior Research AnalystOperatorGood day, welcome to the Daqo New Energy New Fourth Quarter 2025 Results Conference Call. All participants will be in a listen-only mo ...

Financial Data and Key Metrics Changes - In Q4 2025, revenues were $221.7 million, a decrease from $244.6 million in Q3 2025 and an increase from $195.4 million in Q4 2024 [17] - Gross profit was $15.4 million, compared to $9.7 million in Q3 2025 and a gross loss of $65.3 million in Q4 2024 [17] - EBITDA for 2025 was $1.7 million, a significant improvement from a negative $337 million in 2024 [26] - Net loss attributable to shareholders narrowed to $170.5 million in 2025 from $345 million in 2024 [25] - Cash balance at the end of 2025 was $980 million, an increase from $551.6 million at the end of Q3 2025 [26] Business Line Data and Key Metrics Changes - Polysilicon production for Q4 2025 was 42,181 metric tons, aligning with guidance [10] - Sales volume for Q4 2025 reached 38,167 metric tons, with total sales volume for 2025 at 126,707 metric tons [6][10] - Average selling prices (ASPs) for polysilicon decreased by 7.2% from $5.66 per kilogram in 2024 to $5.25 per kilogram in 2025 [6] Market Data and Key Metrics Changes - China's newly installed solar PV capacity grew 14% year-over-year to 317 gigawatts in 2025 [14] - The overall polysilicon production volume fell by 28.4% to 1.32 million metric tons in 2025, while market prices surged more than 50% from mid-2025 lows [13] Company Strategy and Development Direction - The company aims to strengthen its competitive edge through advancements in high-efficiency N-type technology and cost optimization via digital transformation and AI adoption [14] - The focus is on transitioning from price-based competition to value-driven differentiation, supported by government initiatives to tackle overcapacity [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the sector's long-term growth prospects, citing the company's position as one of the world's lowest-cost producers of high-quality N-type polysilicon [14] - The company anticipates a gradual recovery in the market, with expectations for production volumes in 2026 to be between 140,000 metric tons and 170,000 metric tons [11] Other Important Information - The company has implemented proactive measures to mitigate market oversupply, operating at a nameplate capacity utilization rate of 55% [9] - Total production costs declined by 9% to $5.83 per kilogram in Q4 2025, with cash costs reaching a record low of $4.46 per kilogram [10][11] Q&A Session Summary Question: Potential buyback strategy - Management is monitoring share repurchase as part of capital allocation strategy but is waiting for clarity on policy implementation before proceeding [31] Question: Industry consolidation outlook - Management sees recent acquisitions by peers as strategic decisions reflecting confidence in the sector and is open to opportunities that create value [34] Question: Key milestones for policy implementation - Management indicated that clarity on policy details is still pending, and further developments will be monitored closely [42] Question: Pricing outlook for Q1 and Q2 - Management expects prices to remain around RMB 53-54 per kilogram, as mandated by the Pricing Law [47][85] Question: Free cash flow expectations - Management anticipates further improvement in free cash flow in 2026, building on positive trends from 2025 [87]

February 26 2026 Q4 2025 Results Presentation Safe Harbor Statement This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "guidance" and similar statements. Among other things, the outlook for the first quarter and the full y ...

Core Viewpoint - Daqo New Energy Corp. reported its financial results for Q4 2025, showing a mixed performance with improvements in production costs and gross profit, but continued net losses. Financial Highlights - Total cash and investments at the end of Q4 2025 was $2.27 billion, up from $2.21 billion at the end of Q3 2025 [1] - Polysilicon production volume increased to 42,181 MT in Q4 2025 from 30,650 MT in Q3 2025 [1] - Polysilicon sales volume decreased to 38,167 MT in Q4 2025 from 42,406 MT in Q3 2025 [1] - Average total production cost for polysilicon was $5.83/kg in Q4 2025, down from $6.38/kg in Q3 2025 [1] - Average cash cost for polysilicon was $4.46/kg in Q4 2025, slightly down from $4.54/kg in Q3 2025 [1] - Average selling price (ASP) for polysilicon was $5.83/kg in Q4 2025, compared to $5.80/kg in Q3 2025 [1] - Revenue for Q4 2025 was $221.7 million, down from $244.6 million in Q3 2025 [1] - Gross profit increased to $15.4 million in Q4 2025 from $9.7 million in Q3 2025, with a gross margin of 7.0% compared to 3.9% in Q3 2025 [1] - Net loss attributable to shareholders was $7.3 million in Q4 2025, improved from $14.9 million in Q3 2025; loss per basic ADS was $0.11 compared to $0.22 in Q3 2025 [1] - Adjusted net loss attributable to shareholders was $7.3 million in Q4 2025, compared to adjusted net income of $3.7 million in Q3 2025 [1] - EBITDA for Q4 2025 was $52.5 million, up from $45.8 million in Q3 2025, with an EBITDA margin of 23.7% compared to 18.7% in Q3 2025 [1]

Core Viewpoint - Daqo New Energy Corp. plans to announce its unaudited financial results for the fourth quarter and fiscal year ended December 31, 2025, on February 26, 2026, before U.S. markets open [1] Company Overview - Daqo New Energy Corp. is a leading manufacturer of high-purity polysilicon for the global solar PV industry, founded in 2007 [1] - The company has a total polysilicon nameplate capacity of 305,000 metric tons and is recognized as one of the world's lowest cost producers of high-purity polysilicon [1] Financial Results Announcement - The financial results will be discussed in a conference call scheduled for 8:00 AM U.S. Eastern Time on February 26, 2026 [1] - Dial-in details for the earnings conference call include a U.S. toll-free number (+1-888-346-8982) and an international dial-in number (+1-412-902-4272) [1] - A replay of the call will be available one hour after the conclusion of the conference call through March 5, 2026 [1]

Group 1 - Top Wall Street analysts have revised their outlook on several prominent stocks, indicating a shift in market sentiment [1] - The article suggests that investors should consider the stock VERX, highlighting the opinions of analysts regarding its potential [1]

Core Viewpoint - Daqo New Energy Corp. announced an estimated net loss for its subsidiary Xinjiang Daqo New Energy for the fiscal year 2025, indicating a significant reduction in losses compared to the previous year [1][2]. Financial Performance - Xinjiang Daqo estimates its net loss for FY2025 to be between RMB1.0 billion and RMB1.3 billion, a decrease from a net loss of RMB2.7 billion in FY2024 [2]. - The estimated net loss is based on preliminary information and is subject to change upon completion of the internal financial closing process [3][4]. Company Overview - Daqo New Energy Corp. is a leading manufacturer of high-purity polysilicon for the global solar photovoltaic (PV) industry, with a total polysilicon nameplate capacity of 305,000 metric tons [5]. - The company holds approximately 72.8% equity interest in Xinjiang Daqo, which contributes the majority of its revenue and net income [3].

Core Insights - Daqo New Energy (DQ) was considered a promising investment a few years ago due to the surge in solar energy production, particularly in China [1] Company Overview - Daqo New Energy is positioned in the solar energy sector, which has seen significant growth as China leads in production [1] Market Trends - The solar energy market has been experiencing a real push, indicating a growing demand and investment potential in this sector [1]

Summary of Key Points from the Conference Call Industry and Company Overview - The report focuses on the **China & Hong Kong equity market** with a specific outlook for **2026** and investment strategies for **1Q26** [2][5]. Core Themes and Arguments 1. **Constructive Stance on MXCN/CSI300**: The report maintains a positive outlook on MXCN and CSI300, predicting further rallies in 2026 with targets set at **100** for MXCN, **5,200** for CSI300, and **16,000** for MXHK, based on consensus EPS estimates [2][7][9]. 2. **Investment Themes for 2026**: - **Anti-involution**: Expected to accelerate post-March NPC, improving margins and ROE for MXCN/CSI300 [5]. - **AI Infrastructure Growth**: Strong global capex in AI is anticipated to boost demand for computing power and localization plays in China [5]. - **Global Macro Support**: Positive macroeconomic conditions, including easing fiscal and monetary policies in developed markets, are expected to enhance overseas sales [5]. - **K-shaped Recovery in Consumption**: This will favor food & beverage and premium luxury sectors while negatively impacting mid-tier consumption [5]. 3. **Risks Identified**: - **Geopolitical Tensions**: Ongoing tensions between the US and China, particularly ahead of the US mid-term elections, and rising tensions with Japan [5]. - **Consensus EPS Growth Concerns**: Potential downward revisions in consensus EPS growth for MXCN from approximately **15%** to **9%** due to intense competition in quick commerce platforms [5]. - **Property Market Weakness**: Reports of declining luxury sales and price drops in mainland China may trigger policy changes [5]. Sector Recommendations and Top Picks 1. **Under-owned China Equity**: The report suggests that China equity is under-owned both domestically and internationally, indicating potential for increased allocation [6]. 2. **Sector Preferences**: - **Overweight (OW)**: Communication Services, IT, Materials, and Staples. - **Underweight (UW)**: Energy and Utilities [6][12]. 3. **Top Picks for 1Q26**: - **China**: Baidu, NetEase, Midea, MIXUE, PDD, Pop Mart, Trip.com, Tingyi, Futu, Innovent, CATL, COLI. - **Hong Kong**: AIA, HKEX, Futu, Galaxy, MGM China, Techtronic, Link REITs, MTR, China State Construction International [6][13][15]. Important but Overlooked Content - **Valuation Normalization**: Since September 2024, MXCN/CSI300 has shown a return of **29%/30%** in USD terms, indicating a shift from a valuation discount to a more favorable investment narrative [20]. - **EPS Recovery**: The report highlights a broadening recovery in earnings across various sectors despite weak headline EPS growth, with significant recoveries noted in Healthcare, IT, and Communication Services [41][42]. - **Quantitative Macro Indicator (QMI)**: The JPM China QMI indicates an expansion phase, suggesting positive momentum in the market [47]. Conclusion The report presents a comprehensive outlook for the China and Hong Kong equity markets, emphasizing potential growth areas, sector preferences, and the importance of monitoring geopolitical risks and market dynamics as 2026 approaches.