IQE's wireless business unit renews major contract with Tier 1 customer

11 January 2016

Cardiff, UK, 11  January 2016 - IQE plc (AIM: IQE; "IQE", the "Group") the leading manufacturer of advanced semiconductor wafer products to the global semiconductor industry, announces that it has successfully renegotiated its long-term supply contract with its premier Tier 1 Customer for the supply of wafer products used in wireless applications. The Group estimates that the contract will contribute more than USD55 million of revenue during 2016.

The new supply contract guarantees IQE at least 75% of the customer's demand for epiwafers that are produced using its metal organic chemical vapor deposition (MOCVD) platform.  It will also see  an expansion in terms of additional products from its molecular beam epitaxy (MBE) platforms.  This contract renewal underlines the strength of the long-term customer relationship that IQE has developed over many years, having consistently been recognised as one of the customer's best performing suppliers.

IQE's Wireless Business Unit continues to leverage its global manufacturing facilities to fulfill this supply contract from its North American facilities in Massachusetts and Pennsylvania, as well as its manufacturing site in Taiwan.

The contract covers epiwafer products for radio frequency (RF) applications including power amplifiers (PAs), low noise amplifiers (LNAs) and switches used in a myriad of connected devices such smartphones, tablets, PCs, routers, satcoms and other Internet of Things (IoT) devices.

Dr Drew Nelson, IQE CEO and President, said:

"Wireless products continue to represent a key part of IQE's core business. This Tier 1 Customer is a global leader in Wireless connectivity solutions and our long term supply contract demonstrates a strong commitment to IQE.  It also confirms our position as a technology leader and the number one choice for advanced semiconductor products for wireless applications."

Daily HillHead of IQE's Wireless Business Unit  added:

"We view this contract revewal as confirmation that our continuous improvements in technology,  process control and  operational excellence deliver best in class epiwafer products, quality and service.  Global adoption of 4G/LTE and WiFi systems continues and this majority supply contract is testimony to the world-leading performance which IQE products provide for current and next-generation wireless applications"

Contacts:

IQE plc +44 (0) 29 2083 9400
Drew Nelson
Phil Rasmussen
Chris Meadows

Canaccord Genuity (Nomad and Joint Broker) + 44 (0) 20 7523 8000
Simon Bridges
Cameron Duncan

Peel Hunt (Joint Broker) +44 (0) 20 7418 8900
Richard Kauffer
Euan Brown

Capital Access Group +44 (0) 20 3763 3400
Simon Courtenay
Harry Rippon

NOTE TO EDITORS

ABOUT IQE

www.iqep.com

IQE is the leading global supplier of advanced semiconductor wafers with products that cover a diverse range of applications, supported by an innovative outsourced foundry services portfolio that allows the Group to provide a 'one stop shop' for the wafer needs of the world's leading semiconductor manufacturers. 

IQE uses advanced crystal growth technology (epitaxy) to manufacture and supply bespoke semiconductor wafers ('epiwafers') to the major chip manufacturing companies, who then use these wafers to make the chips which form the key components of virtually all high technology systems. IQE is unique in being able to supply wafers using all of the leading crystal growth technology platforms.

IQE's products are found in many leading-edge consumer, communication, computing and industrial applications, including a complete range of wafer products for the wireless industry, such as mobile handsets and wireless infrastructure, Wi-Fi, WiMAX, base stations, GPS, and satellite communications; and optical communications. 

The Group also manufactures advanced optoelectronic and photonic components such as semiconductor lasers, vertical cavity surface emitting lasers (VCSELs) and optical sensors for a wide range of applications including optical fibre communications, optical storage (CD, DVD, BluRay), thermal imaging, leading-edge medical products, pico-projection, finger navigation ultra-high brightness LEDs, and high efficiency concentrated photovoltaic (CPV) solar cells.

The manufacturers of these chips are increasingly seeking to outsource wafer production to specialist foundries such as IQE in order to reduce overall wafer costs and accelerate time to market.

IQE also provides bespoke R&D services to deliver customised materials for specific applications and offers specialist technical staff to manufacture to specification either at its own facilities or on the customer's own sites. The Group is also able to leverage its global purchasing volumes to reduce the cost of raw materials. In this way, IQE's outsourced services, provide compelling benefits in terms of flexibility and predictability of cost, thereby significantly reducing operating risk.

IQE operates a number of manufacturing and R&D facilities across Europe, Asia and the USA. The Group also delivers its products and services through regional sales offices located in major economic centres worldwide.