Shares of Daqo New Energy (DQ.US) fell more than 6% to $23.50 on Thursday. The company's latest earnings report revealed non-GAAP earnings per ADS of -$0.11 for the fourth quarter of 2025, which was $0.14 better than market expectations. However, revenue came in at $221.7 million, a 13.5% year-over-year increase but significantly below market forecasts, serving as a primary factor pressuring the stock price.
Operationally, Daqo New Energy increased its polysilicon production to 42,181 metric tons for the quarter, showing significant growth from the third quarter. Sales volume, however, declined to 38,167 metric tons, down from 42,406 tons in the prior quarter, indicating ongoing fluctuations in downstream demand and inventory reduction cycles. On the cost front, improvements continued as the average total production cost decreased to $5.83 per kilogram, with cash cost falling to $4.46 per kilogram, helping to cushion the impact of price volatility. The average selling price (ASP) for polysilicon saw a modest sequential increase to $5.83 per kilogram.
Looking ahead, the company anticipates first-quarter 2026 production to be between 35,000 and 40,000 metric tons, with full-year production projected in the range of 140,000 to 170,000 tons. While the declining costs and rising production volumes are viewed as positive signals, investor confidence in near-term profit recovery remains cautious amid an uncertain industry supply-demand balance and price stabilization trajectory, contributing to the stock's weakness.
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