These half-year figures from semiconductor wafer maker IQE (IQE) slightly beat analysts' expectations - forecasts that had already been substantially upgraded following a trading update in July. That outperformance was driven by a robust first half for the wireless division, which generates around 85 per cent of sales.
At that business, the acquisition of Kopin Wireless boosted revenues substantially and also helped deliver a 10-fold increase in group-wide adjusted pre-tax profits to £5.1m. This demonstrates the new scale of the business and the highly leveraged business model. The photonics division, meanwhile, has also made major strides. In August, IQE and its partners set a world efficiency record for its production-scale CPV wafer technology - that suggests potential upside for IQE's profits in 2014 and 2015 should adoption of the technology accelerate faster than the industry currently anticipates. What's more, the previously imminent threat that Qualcomm (NASDAQ: QCOM) would make a rival compound semiconductor product has receded for the foreseeable future.