Tower Semiconductor Posts 14% Q4 Revenue Rise, Expands Capex to $920M
Tower Semiconductor delivered Q4 revenue of $440.21 million, a 14% year-over-year increase, with adjusted EPS of $0.78 beating estimates by $0.10. Gross margin expanded to 26.7% as the company raised silicon photonics and SiGe capex to $920 million, with 70% of capacity prebooked through 2028.
1. Q4 Financial Results
Tower Semiconductor posted Q4 revenue of $440.21 million, up 14% year-over-year, and delivered adjusted EPS of $0.78, exceeding consensus estimates by $0.10.
2. Margin Expansion and Cash Position
Gross profit rose 35.4% year-over-year to $117.61 million, lifting gross margin to 26.7%. Operating profit climbed 52.6% to $70.83 million, and cash and equivalents stood at $1.15 billion as of December 31, 2025.
3. Massive Silicon Photonics and SiGe Capex Plan
The company increased its silicon photonics and SiGe investment by $270 million, bringing total capex to $920 million. It aims to install and qualify all equipment by Q4 2026, with customers reserving over 70% of capacity through 2028.
4. Intel Deal Mediation and Outlook
A 300mm wafer production agreement with Intel has entered mediation, prompting a shift of flows back to Tower’s Fab7 site. First-quarter revenue is projected between $391.4 million and $432.6 million.