Abstract

Daqo New Energy will report quarterly results on February 26, 2026, Pre-Market, and consensus points to sequential margin stabilization with improved year-over-year revenue and EPS momentum alongside narrowed operating losses.

Market Forecast

Based on the company’s latest available projections, Daqo New Energy’s current quarter revenue is estimated at $273.70 million, up 78.26% year over year; EPS is forecast at -$0.18, improving 91.59% year over year, and EBIT is projected at -$20.51 million, improving 77.13% year over year. The main business is expected to pivot on shipment execution and realized pricing relative to recent quarters, with attention on operational efficiency to support margin recovery. The most promising area of revenue concentration remains the core product line, where absolute sales contribution is highest and incremental improvements can meaningfully influence consolidated results.

Last Quarter Review

Daqo New Energy posted last quarter revenue of $244.60 million (up 23.23% year over year), a gross profit margin of 3.95%, net profit attributable to the parent company at a loss of $14.92 million, a net profit margin of -6.10%, and adjusted EPS of -$0.22 (improving 76.09% year over year). A key highlight was the quarter-on-quarter rebound in net profit, which improved by 80.49%, reflecting reduced losses and better operating performance relative to the prior quarter. Main business revenue was concentrated in core products: polysilicon at $323.20 million (approximately 91.60% of total), wafer-related sales at $58.78 million (about 16.66%), and net effect from write-offs of -$29.13 million (around -8.25%), with the consolidated top line growing 23.23% year over year.

Current Quarter Outlook

Main Business: Revenue Execution, Pricing Realization, and Margin Continuity

The central focus for this quarter is whether Daqo New Energy can translate volume execution into measurable margin improvement, given the prior quarter’s low gross profit margin of 3.95% and a net margin of -6.10%. The company’s revenue estimate of $273.70 million suggests a meaningful acceleration compared to $244.60 million last quarter, with a 78.26% year-over-year uplift indicating substantial normalization versus the prior-year baseline. On profitability, the forecasted EPS of -$0.18, a 91.59% year-over-year improvement, and EBIT of -$20.51 million, improving 77.13% year over year, point to a smaller operating loss and a trajectory toward breakeven if cost control and product mix trends continue favorably. The key determinant for margin stabilization will be the extent to which realized pricing and unit volumes offset residual cost, inventory, and any non-recurring items that can pressure gross profit penetration. Execution on customer shipments and contract adherence is likely to influence both the quarterly revenue composition and margin cadence, with product delivery timing and mix potentially swinging reported profitability.

Most Promising Business: High-Contribution Core Product Line and Incremental Profit Leverage

With the prior quarter showing polysilicon contributing approximately 91.60% of reported revenue, the most promising lever for near-term profitability is incremental efficiency and pricing realization within this core product line. The absolute scale of revenue in this segment, at $323.20 million last quarter, means even modest margin improvements could produce noticeable changes in consolidated operating income and EPS. While the wafer-related contribution of $58.78 million provided diversification, the magnitude of the core product line’s share underscores that shifts in its margin structure are the primary catalyst for earnings volatility. The elimination or reduction of write-down impacts, which were -$29.13 million last quarter, would also create direct leverage to gross profit and net income. This quarter’s forecasted top-line growth suggests that, if shipment quality and pricing discipline hold, the business could post improved conversion from revenue to EBIT despite the negative EBIT estimate, narrowing losses and potentially setting a higher base for subsequent quarters.

Stock Price Drivers: Reported Margin, Loss Narrowing, and Forward Commentary on Expense and Mix

Near-term stock performance will likely hinge on reported gross margin versus last quarter’s 3.95% and whether the company demonstrates further loss narrowing beyond the forecasted -$20.51 million EBIT and -$0.18 EPS. Investors will pay attention to any commentary regarding non-recurring items and whether they recede, thereby providing cleaner visibility into underlying profitability. The interplay between realized pricing and unit volumes may materially impact quarterly earnings quality; mix effects that enhance gross profit conversion will be supportive, particularly against the backdrop of rising year-over-year revenue and improving EPS metrics. Shareholders will also watch management’s discussion on operating expense control, procurement efficiency, and potential contract dynamics that influence quarterly margin variability. If forward-looking remarks confirm sustained improvements in operating metrics and detail tangible steps to reduce loss frequency and magnitude, it could bolster confidence in the path to breakeven.

Analyst Opinions

Within the January 1, 2026 to February 19, 2026 window, accessible market commentary specific to Daqo New Energy’s upcoming quarter was limited, with no fresh rating changes or published previews identified from major institutions during the period. As a result, the majority stance across available references in this timeframe is best characterized as Neutral, reflecting an absence of new directional calls and an emphasis on monitoring whether the company’s improving year-over-year revenue and EPS forecasts translate into margin stabilization. The neutral read aligns with the current-quarter forecasts that anticipate improved year-over-year metrics but still negative EBIT and EPS, prompting institutional attention to the quality of revenue conversion and the durability of any loss reduction. This perspective emphasizes verification of sequential profitability progress rather than a decisive bullish or bearish thesis, pending the company’s delivery on margin and cost-containment milestones in February 26, 2026 Pre-Market results.