DIOD

Image source: The Motley Fool. Wednesday, August 5, 2026 at 5 p.m. ET President and CEO - Gary Yu CFO - Brett Whitmire Senior Vice President of Worldwide Sales and Marketing - Emily Yang Vice President of Marketing and Investor Relations - Gurmeet Dhaliwal Operator: Good afternoon, and welcome to Diodes Incorporated Second Quarter 2026 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded today, Wednesday, August 5, 2026. I would now like to turn the call over to Leanne Sievers of Shelton Group Investor Relations. Leanne, please go ahead. Leanne Sievers: Good afternoon, and welcome to Diodes Second Quarter 2026 Financial Results Conference Call. I'm Leanne Sievers, President of Shelton Group, Diodes' Investor Relations firm. Joining us today are Diodes' President and CEO, Gary Yu; CFO, Brett Whitmire; Senior Vice President of Worldwide Sales and Marketing, Emily Yang; and Vice President of Marketing and Investor Relations, Gurmeet Dhaliwal. I'd like to remind our listeners that the results announced today are preliminary as they are subject to the company finalizing its closing procedures and customary quarterly review by the company's independent registered public accounting firm. As such, these results are unaudited and subject to revision until the company files its Form 10-Q for its quarter ended June 30, 2026. In addition, management's prepared remarks contain forward-looking statements, which are subject to risks and uncertainties, and management may make additional forward-looking statements in response to your questions. Therefore, the company claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from those discussed today, and therefore, we refer you to a more detailed discussion of the risks and uncertainties in the company's filings with the Securities and Exchange Commission, including Forms 10-K and 10-Q. In addition, any projections as to the company's future performance represent management's estimates as of today, August 5, 2026. Diodes assumes no obligation to update these projections in the future as market conditions may or may not change, except to the extent required by applicable law. Additionally, the company's press release and management statements during this conference call will include discussions of certain measures and financial information in GAAP and non-GAAP terms. Included in the company's press release are definitions and reconciliations of GAAP to non-GAAP items, which provide additional details. Also throughout the company's press release and management statements during this conference call, we refer to net income attributable to common stockholders as GAAP net income. For those of you unable to listen to the entire call at this time, a recording will be available via webcast for 90 days in the Investor Relations section of Diodes website at www.diodes.com. And now I'll turn the call over to Diodes' President and CEO, Gary Yu. Gary, please go ahead. Gary Yu: Welcome, everyone, and thank you for joining us on today's conference call. As announced in our press release earlier today, we extend our momentum in the second quarter with revenue again increasing more than 20% year-over-year, driven by growth across all regions. Revenue also increased 10% sequentially, coupled with a record global POS. As the fifth consecutive quarter of double-digit year-over-year growth, this quarter serves as a further confirmation of strengthening demand in overall market. combined with expanding content across our analog and power solutions in our key focus areas of automotive, industrial and AI server-related applications. Automotive revenue reached a record level of 21% of our product revenue. We continue to drive increased content with an expanding pipeline of new products that's resulting in consistent market share gains across our regions auto manufacturers and suppliers. Also, during the quarter, the cost and operating initiatives we previously implemented during the market slowdown are producing measurable benefit to gross margin and our bottom line, with margin increasing 160 basis points year-over-year and non-GAAP earnings increasing by more than 100% again this quarter. These actions have also contributed to increased cash flow that has enabled us to reinvest in our growth and innovation while also looking for inorganic opportunity to expand our technology portfolio, such as recent proposed acquisition of ElevATE Semiconductor. ElevATE is a fabless semiconductor company that specialized in development of integrated circuit of automated test equipment or ATE. The explosive growth, increasing complexity and higher performance requirements of IC used in automotive, industrial data center and AI applications are driving greater semiconductor production volume and in turn, increasing demand for automated test equipment. This acquisition enhanced our ability to provide a broader solution to customers and launch a new advanced product line that will drive increased dollar content in ATE applications. I also want to add that this acquisition is immediately accretive and expect to add approximately $50 million of revenue in the first 12 months post close, with revenue expected to grow at a CAGR of greater than 20% over the next 4 years and with gross margin significantly higher than Diodes' corporate average. As we look to the third quarter, we expect to extend our accelerating traction with revenue anticipated to increase 30% year-over-year and 14% sequentially at the midpoint. We also expect to deliver another 190 basis point sequential improvement in gross margin. As our utilization continues to improve, combined with a 2.8x year-over-year improvement in non-GAAP earnings. These expected results drive us closer toward our 3-year financial goals of $2 billion in annual revenue and over $4 in non-GAAP EPS. With that, let me now turn the call over to Brett to discuss our second quarter financial results as well as third quarter guidance in more detail. Brett Whitmire: Thanks, Gary, and good afternoon, everyone. Revenue for the second quarter 2026 was $445.5 million, an increase of 22% over $366.2 million in the second quarter of 2025 and up 10% compared to $405.5 million in the first quarter 2026. Gross profit for the second quarter was $147.6 million or 33.1% of revenue compared to $115.3 million or 31.5% of revenue in the prior year quarter and $128.8 million or 31.8% of revenue in the prior quarter. GAAP operating expenses for the second quarter were $114.3 million or 25.6% of revenue and on a non-GAAP basis were $108.6 million or 24.4% of revenue, which excludes $3.9 million amortization of acquisition-related intangible asset costs, $1.5 million of Board and officer retirement expense and $0.3 million of acquisition-related costs. This compares to GAAP operating expenses in the second quarter 2025 of $105.9 million or 28.9% of revenue and $109 million or 26.9% of revenue in the prior quarter. Non-GAAP operating expenses in the prior quarter were $103.9 million or 25.6% of revenue. Total other income amounted to approximately $24.7 million for the quarter, consisting of $20 million in unrealized gain on investments, $5.5 million in interest income, $0.5 million in other income, offset by $1 million in foreign currency losses and $0.3 million in interest expense. Income before taxes, equity and net earnings of equity investments and noncontrolling interest in the second quarter 2026 was $58 million compared to $53.2 million in the prior year period and $22.4 million in the previous quarter. Turning to income taxes. Our effective income tax rate for the second quarter was approximately 12.3%. For 2026, we expect the tax rate for the full year to remain at approximately 18%, plus or minus 3%. GAAP net income for the second quarter was $46.6 million or $1 per diluted share compared to a net income of $46.1 million or $0.99 per diluted share in the prior year quarter and net income of $15 million or $0.32 per diluted share last quarter. The share count used to compute GAAP income per share for the second quarter of 2026 was 46.4 million shares. Non-GAAP adjusted net income in the second quarter was $32.5 million or $0.70 per diluted share, which excluded net of tax, an $18.7 million gain on investments, $3.2 million of acquisition-related intangible asset costs, $1.2 million in Board officer retirement expense and $0.2 million in acquisition-related costs. This compares to non-GAAP adjusted net income of $15 million or $0.32 per diluted share in the second quarter 2025 and $19.8 million or $0.43 per diluted share in the prior quarter. Excluding noncash share-based compensation expense of $8.9 million for the second quarter, net of tax, both GAAP net income and non-GAAP adjusted net income would have increased by $0.19 per share. EBITDA for the second quarter was $83.5 million or 18.7% of revenue compared to $84.5 million or 23.1% of revenue in the prior year period and $49.4 million or 12.2% of revenue in the prior quarter. We have included in our earnings release a reconciliation of GAAP net income to non-GAAP adjusted net income and GAAP net income to EBITDA, which provides additional details. Cash flow provided by operations was $68.5 million for the second quarter, Free cash flow was $34.8 million, including $33.6 million of capital expenditures. Net cash flow was a positive $32.9 million, which includes $10 million for the stock buyback program. Turning to the balance sheet. At the end of second quarter, cash, cash equivalents, restricted cash plus short-term investments totaled approximately $442 million. Working capital was approximately $931 million and total debt, including long term and short term, was approximately $40 million. In terms of inventory, at the end of second quarter, total inventory days decreased to approximately 152 days as compared to 157 days last quarter. Finished goods inventory days were approximately 51 days compared to 55 days last quarter. Total inventory dollars increased $11.8 million from the prior quarter to $504.6 million, consisting of an $8.7 million increase in raw materials, a $4.2 million increase in work in process and a $1.1 million decrease in finished goods. The increase in inventory helps to support customers and expected growth as well as longer wafer manufacturing lead times. Capital expenditures on a cash basis were $33.6 million for the second quarter or 7.5% of revenue, which was within our targeted annualized range of 5% to 9% of revenue. Now turning to our outlook. For the third quarter, we expect revenue to increase to approximately $510 million, plus or minus 3%. At the midpoint, this represents a 30% increase year-over-year and a 14% increase sequentially. GAAP gross margin is expected to expand to 35%, plus or minus 1%. Non-GAAP adjusted EPS is expected to be $1.05, plus or minus $0.10. With that, I will now turn the call over to Emily Yang. Emily Yang: Thank you, Brett, and good afternoon. As Gary and Brett mentioned, revenue in the second quarter was up 10% sequentially and exceeded the midpoint of our guidance. This growth was mainly driven by strong demand in Asia, followed by North America. Global POS increased quarter-over-quarter and reached record levels, driven by Americas, followed by Asia and Europe. Our channel inventory decreased both in terms of dollars and weeks again this quarter with the weeks lower than our normal range of 11 weeks to 14 weeks. The supply disruption I've mentioned on previous call continues, and we remain strategically focused on building long-term sustainable business and content opportunities at key automotive, industrial and AI-related applications and customers. Our achievement of record automotive revenue in the quarter validates the success of our strategy and market share gain with customers. With our strong second quarter results and third quarter guidance, this further underscore our solid operational performance and the initial benefit from aggressive capacity expansion activities and our hybrid manufacturing strategy. Looking at global sales in the second quarter, Asia represented 79% of revenue; Europe, 12%; and North America, 9%. In terms of our end markets, industrial was 23% of Diodes product revenue; automotive, a record 21%; computing, 28%; consumer 17%; and communication, 11% of product revenue. Overall, AI infrastructure is becoming an increasingly important growth driver for Diodes that spans multiple end markets. AI should be viewed not as a single application, but as a broad system-level ecosystem. In a typical AI infrastructure platform, Diodes content can attach across several applications, including the server motherboard, a power network that supports a full power life cycle, networking switches, storage and high-speed optical interconnect. Across this combined AI application areas, our estimated total content opportunity is approximately $267, representing a meaningful incremental increase compared to AI server platforms of $109. With several new products scheduled for release over the next few quarters, Diodes is well positioned to expand its BOM content, strengthen socket penetration and gain share as AI platform continues to scale in power density, connectivity bandwidth and system complexity. Now let me review the end market in greater detail. Starting with automotive market, revenue grew 15% sequentially and over 37% year-over-year. The increase was driven by continuous business expansion and market share gains. Our design win momentum extended across all focus areas. In connected driving, adoption of ADAS telematics infotainment systems continue to accelerate as automakers increase the number of sensors, cameras, radar modules and processors within each vehicle. These architectures require robust interface and protection solutions, and we are seeing strong momentum for our voltage translation ICs, power management and networking products as vehicle communication and processing requirements continue to increase. Across comfort, style and safety, we are seeing strong adoption of power protection, smart power switching, motor control and automotive lighting solutions. The advanced lighting solutions, vehicle body electronics and intelligent control modules continue to require higher level of functionality and reliability, creating additional opportunities for our products. In the electrification, the transition towards higher voltage EV platforms faster charging infrastructures and more sophisticated battery management system is driving demand for our power semiconductors, wide band gap solutions and signal management devices. We continue to expand our portfolio to address applications ranging from battery management and onboard charging to DC/DC conversion and zone control architecture. Overall, our automotive portfolio continues to gain traction across both ICE and EV applications. Our emphasis on our 3 focus areas, combined with higher vehicle semiconductor content continue to support our long-term automotive growth strategy. Turning to industrial market. Revenue increased 5% sequentially and over 24% year-over-year. As a percentage of total product revenue, industrial was down 1% from last quarter, while actual demand remains strong. The industrial market continues to benefit from strong demand across AI infrastructures, industrial automation, robotics, energy management, health care and smart infrastructure applications. Growth is being driven by increasing requirements for power efficiency, sensing, connectivity and embedded intelligence in next-generation systems. With the shift towards 400-volt and 800-volt power architectures becoming an important trend in AI-related applications, our power management product and discrete products remain key growth drivers. This transition supports higher power density, lower distribution losses and more efficient immediate bus conversion, creating additional content opportunity for us. We are also seeing new growth opportunity emerge through humorized (sic) [ humanoid ] robotic, where increasing system complexity is creating demand for discrete products, voltage translation and connectivity solutions as commercial deployment move towards scale. Overall, Diodes is well positioned to benefit from the increasing intelligence, embedded computing, connectivity and power demand for next-generation industrial systems. In the computing market, revenue increased 18% sequentially and 33% year-over-year. This market continues to be our strongest growth driver due to accelerating adoption across data center, AI server, cloud infrastructure and storage platforms. Our timing portfolio continued to gain traction as customers transition to next-generation PCI Express architectures. We secured multiple strategic server platform design wins for our clock generators and timing solutions with design activity, customer engagement and backlog trending remains strong. New timing products are now ramping into the latest AI server platforms, further expanding our presence in this high-growth market. Beyond timing, the AI infrastructure build-out is increasing semiconductor content per server, creating opportunities across connectivity, signal integrity, interface, power management, sensing and protection devices. We are also benefiting from increasing power density requirement in AI servers and data center, which are driving strong demand for our power distribution, protection, sensing and voltage reference portfolios. In the consumer market, revenue increased almost 10% sequentially and 17% year-over-year, but remained flat to the last quarter as a percentage of total product revenue. Overall, the market remained challenged by memory shortage and slower demand. That said, we did see some areas of strength that helped offset the supply challenges. We saw strength in charging, USB power delivery solutions, ESD protection devices for storage applications and level shifters, an interface product benefiting from increasing adoption of AI-enabled IoT devices, smart home systems and multi-voltage architectures. Together, these product families reflect our focus on higher-value consumer applications where increasing functionality, connectivity and power efficiencies are driving greater semiconductor content. Lastly, in the communication market, revenue decreased 7% sequentially and approximately 3% year-over-year. Demand in this market remains soft, especially in the smartphone market in China. On a positive side, networking remains strong with demand creation momentum supported by growing investments in AI infrastructures, enterprise networking and next-generation mobile devices. With mobile and edge devices, we continue to benefit from demand for power management products in AI-enabled smartphones, wearables and emerging smart glasses. AI is driving new opportunities across both networking infrastructures and intelligent edge devices, expanding our design win pipeline and supporting future growth in communication market for diodes. In summary, we are pleased with our strong growth momentum and gross margin expansion as we continue to emphasize content expansion initiatives across our key focus area of automotive, industrial and AI server-related applications. We are guiding for continued growth in revenue, margins and non-GAAP earnings, which puts us on a solid track towards the achievement of our 3-year financial goals. With that, we now open the floor to questions. Operator? Operator: [Operator Instructions] Your first question comes from the line of William Stein from Truist Securities. Unknown Analyst: This is [ Elliot ] on for Will. First, can you provide some color on your SPFAB, status of revenue and profitability, maybe where things stand on utilization and getting products qualified and moved in-house? Gary Yu: Well, this is Gary. Let me give you some insight about that wafer fab. Usually, we don't provide this kind of P&L for that particular wafer fab. But as I say so from a couple of quarters, and I do believe in the progress on loading that wafer fabs continue growing on that. And also, we do see the key customers starting using the wafer fab -- the wafer produced from wafer fab as their product. And I do believe in the near future, and we can continue to grow the utilization on this wafer fab. Unknown Analyst: Okay. And then if I get one more. Can you talk us through end market expectations as we move into Q3 and then potentially into Q4 as well, given such strong growth you're expecting? And then if I can try, if you can look a little further out, maybe ranking your growth opportunities as you move into 2027? Emily Yang: This is Emily. Let me answer this question, right? So overall, Q3 with a very strong guidance, 14.5% quarter-over-quarter growth, we do expect growth from almost all the end market segments. I would say majority would continue driven by the AI-related applications, especially on the surfer motherboard side. I think automotive definitely show a lot of strength, very strong growth momentum, and we expect that will continue by market share gain and the expansion of some of the products. On the industrial side, I think the excess inventory is definitely beyond us right now. We're definitely also see the market recover from there. So we also expect industrial growth in the third quarter. Consumer is usually a peak quarter for the third quarter. I know there's some combination of different things. But all in all, we also expect that to see some improvement. On the communications side, right, smartphone demand is very similar to consumer, so similar to the comment I made before. On top of that, we believe the networking portion of this communication market segment should continue to grow driven especially with some AI networking switches and routers, right? So I would say, all in all, we actually have a really good guidance for Q3, and we're definitely marching towards to make sure we achieve and meet the goal. Regarding Q4, we usually don't provide more than 1 quarter's guidance, but definitely, we're seeing good momentum so far for the Q4. I think for next year, it's a little bit longer out there. But all in all, with the market we're seeing, we feel like it should be stronger than usual. Operator: Our next question comes from the line of Tristan Gerra from Baird. Tristan Gerra: Some of your peers have reported some constraints, notably for power product supply. Are you seeing any supply constraint? Will you be able to ship more without it, notably into data center? Emily Yang: Right, Tristan. I think overall, we've been talking about very strong demand across the board. I think there's definitely pockets of, I would say, areas that are a little bit more constrained than the others. But all in all, what we really want to focus is actually focus working with our strategic customers and give them the best support we can. I think during the COVID, we actually have similar discussions before. Our focus is really working with the customer, understand their true demand and give them the best for, make sure to prevent any of the shortage or line down issue they are facing. But I would say, all in all, because the demand is so strong, definitely, there's pockets of areas of supply is a little bit constrained. Gary Yu: Yes. And also, Tristan, let me add more color on that, right? As Emily said, we do see the very strong demand this year, even further more in the next year. But as we leverage more on our heavy model, no matter internal or external, we want to make sure we can continue add capacity, no matter continue utilizing our internal wafer fab and also add more capacity in our back end to support our customers. So our growth not only limit on the demand, but also we do have more capacity we can support the customer for the future needs. Tristan Gerra: Okay. Great. And then just as a quick follow-up. So you mentioned capacity expansion efforts. Is that on the front end? Is that internal capacity? And if so, what geography are you building capacity? Gary Yu: Well, let me say that in this way, okay? For the wafer fab, we continue utilizing improving the utilization for our GFAB and SPFAB and there's some room we can also do more on that. And also, we are doing some migration from 6-inch to 8-inch, right to get more capacity on the wafer fab. Also leverage our external partner, right? And no matter the partner in Korea or in Taiwan, to get more capacity from them. So that's one thing. Second is that for our assembly testing, probably 75% assembly testing we do internally. On the particular package we are doing here, we do add more capacity on that. We are not adding every packaging capacity. We selectively pick the package, which might get more advance [indiscernible] that, for example, like or CSP. This type of package, we can provide a better value and can provide a better service to our key customers, like Emily said. And we'll continue to do the investment on that. Tristan Gerra: Okay. And then lastly, I'll just squeeze one in really quick. What's the percentage of your production that's currently fab versus what's outsourced? Gary Yu: It's about 50-50 at this moment. Operator: Our next question comes from the line of David Williams from Needham & Company. David Williams: So look, you guys are doing a really great job here of finding the demand and continuing to grow in all the right areas and drive the gross margin. I guess as I kind of think about the most recent acquisition you made, ElevATE, can you talk maybe through some of that color or maybe rationale? It seems like a really great fit. But just kind of curious if there's anything about that acquisition that maybe we're not thinking of or haven't really understood yet, do you think? Gary Yu: Of course. And first, we are very excited about the recent proposed acquisition of this company. As I said, ElevATE is a fabless semiconductor company, very special and very strong in developing IC for APE, the kind of application like automated testing equipment. okay? I think ElevATE complement's Diodes currently analog and mixed signal product portfolio with highly differentiated IP and a higher-margin product with a low power, high density, higher performance signal chain amplified and data converter. We do, of course, see a lot of synergy especially on product synergy. And also, we do see the market synergy, for example, by increasing our exposure on the attractive ATE market and also through this new customer and opportunity to expand our share for the wallet to the existing customer. So all in all, I would say that with this kind of synergy, we combine elevator core channel expertise with the Diodes analog and product portfolio, and we can easily expand the channel provider to AP platform solution provider. So with that kind of synergy together, we can easily for the addressable market probably like $1 billion at least above. David Williams: Okay. Very good. Certainly appreciate that. And then I think this question was asked around the edges earlier, but just kind of curious if you could give us your thoughts on maybe the demand trends and how the channel inventory, if you feel like you're shipping to consumption? And maybe any concerns about double ordering just kind of given the strength of the demand? Do you think that's beginning to happen? Or do you feel like you've got a pretty good handle on that? Emily Yang: David, this is Emily. If you look at our channel inventory, we actually decreased both in terms of dollars as well as weeks. It's definitely lower than our normal range of 11 weeks to 14 weeks, right? So we definitely don't see the double booking or double shipments to the customer building up the channel inventory at this moment. I think what we're looking at is we try to balance the ship through at this moment, but we're not there. So I don't really think this is a concern, right? Operator: That concludes our question-and-answer session. I will now turn the call back over to Guy Yu, CEO and President, for closing remarks. Gary Yu: Thank you, everyone, for participating on today's call. We look forward to reporting our continued progress on next quarter's conference call. Operator, you may now disconnect. Operator: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect. Before you buy stock in Diodes, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Diodes wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Diodes (DIOD) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Get insights on thousands of stocks from the global community of over 7 million individual investors at Simply Wall St. Diodes (DIOD) just reported second quarter 2026 results alongside fresh third quarter guidance, giving you new data on revenue, earnings, and capital returns to reassess how the stock fits your portfolio. See our latest analysis for Diodes. The earnings beat, strong third quarter guidance and recent buyback activity have come alongside sharp share price moves. Diodes’ year to date share price return of 91.95% and 1 year total shareholder return of 109.29% point to strong positive momentum, despite a 90 day share price return that is down 11.39%. If you are watching how AI infrastructure demand is affecting semiconductor stocks, this is a good moment to scan the market and review 56 AI infrastructure stocks Diodes now combines strong recent growth, fresh guidance and an active buyback, along with a share price that has already moved significantly this year. The key issue is whether the stock still offers sensible value at today’s levels. Diodes closed at $98.72 compared with a most widely followed fair value estimate of $75.67, so the narrative points to a premium that needs explaining. Tailwinds from the global trend toward digitalization, industrial automation, and regulatory push for energy efficiency are expanding demand for Diodes' power-efficient semiconductor solutions, increasing long-term addressable markets and supporting multi-year revenue growth. Read the complete narrative. Curious what kind of revenue path, margin lift, and future earnings multiple are baked into that fair value? The narrative sets out a detailed financial roadmap. The assumptions behind it may surprise you. Result: Fair Value of $75.67 (OVERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, Diodes still faces key risks, including its heavy exposure to cyclical consumer demand and its high inventory levels, which could pressure margins if conditions turn. Find out about the key risks to this Diodes narrative. Given the mix of optimism around Diodes and the clear risks on the table, it makes sense to act quickly and dig into both sides of the story. To weigh the potential upsides against the areas investors are worried about, start by checking the 2 key rewards and 4 important warning signs. If Diodes has you thinking about what else could fit your portfolio, now is the time to line up a few more ideas that match your goals. Target long term compounding potential by reviewing companies on the 51 high quality undervalued stocks so you do not miss stocks trading at a discount with solid fundamentals. Build a steadier income stream by checking the 9 dividend fortresses and see which dividend payers might help balance out more volatile holdings. Strengthen your downside protection by scanning the 78 resilient stocks with low risk scores before the next wave of headlines shifts where the market is focusing. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DIOD. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Interested in Diodes Incorporated? Here are five stocks we like better. Diodes reported strong second-quarter growth: Revenue rose 22% year over year to $445.5 million, while adjusted EPS more than doubled to $0.70. Gross margin improved to 33.1%, supported by cost and operating initiatives. Management expects acceleration in the third quarter: Revenue is forecast at approximately $510 million, representing 30% year-over-year growth at the midpoint, with a projected 35% GAAP gross margin and adjusted EPS of $1.05. Automotive, computing and AI infrastructure are driving demand: Computing revenue increased 33% year over year and automotive revenue rose more than 37%, while the proposed Elevate Semiconductor acquisition is expected to add higher-margin products and about $15 million in first-year revenue. Two Value Tech Stocks Trading Near a Breakout Level Diodes (NASDAQ:DIOD) reported second-quarter revenue growth of 22% from a year earlier and issued third-quarter guidance that calls for continued expansion in sales, gross margin and adjusted earnings, citing demand across automotive, industrial and AI-related applications. Revenue for the quarter ended June 30 was $445.5 million, up from $366.2 million in the same period of 2025 and 10% above $405.5 million in the first quarter. President and CEO Gary Yu said the result marked the company’s sixth consecutive quarter of double-digit year-over-year revenue growth and was supported by growth in every geographic region as well as record global point-of-sale activity. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control Yu said Diodes’ automotive revenue reached a record 21% of product revenue during the quarter. He attributed the performance to expanding semiconductor content and market-share gains in automotive, industrial and AI-server applications. Second-quarter gross profit was $147.6 million, representing a gross margin of 33.1%, compared with 31.5% a year earlier and 31.8% in the prior quarter. Yu said cost and operating initiatives implemented during the market slowdown contributed to a 160-basis-point year-over-year improvement in gross margin. → 3 Drone Stocks That Should Soar After the Summer Slump GAAP net income was $46.6 million, or $1.00 per diluted share, compared with $46.1 million, or $0.99 per diluted share, in the prior-year quarter. The GAAP result included approximately $20 million in unrealized gains on investments, according to CFO Brett Whitmire. On a non-GAAP basis, adjusted net income was $32.5 million, or $0.70 per diluted share, compared with $15 million, or $0.32 per diluted share, a year ago and $19.8 million, or $0.43 per diluted share, in the first quarter. Adjusted results excluded, net of tax, investment gains, acquisition-related intangible amortization, board and officer retirement expenses, and acquisition-related costs. → The Bitcoin Comeback May Already Be Underway—2 ETFs for Exposure Cash flow from operations totaled $68.5 million, while free cash flow was $34.8 million after $33.6 million in capital expenditures. The company had approximately $442 million in cash equivalents, restricted cash and short-term investments at quarter-end, against approximately $40 million of total debt. Inventory days declined to approximately 152 from 157 in the first quarter. Finished-goods inventory days fell to 51 from 55. Whitmire said inventory dollars increased by $11.8 million to $504.6 million to support customer requirements, anticipated growth and longer manufacturing lead times. For the third quarter, Diodes expects revenue of approximately $510 million, plus or minus 3%. At the midpoint, that would represent a 30% year-over-year increase and a 14% sequential increase. The company forecast GAAP gross margin of 35%, plus or minus 1%, and non-GAAP adjusted earnings per share of $1.05, plus or minus $0.10. Yu said the expected results would include another 190 basis points of sequential gross-margin improvement and bring the company closer to its three-year targets of $2 billion in annual revenue and more than $4 in non-GAAP EPS. Senior Vice President of Worldwide Sales and Marketing Emily Yang said Diodes expects growth in nearly all end markets during the third quarter. She identified AI-related applications, particularly server motherboards, automotive market-share gains, industrial recovery, seasonal consumer demand and networking demand as expected contributors. Automotive revenue increased 15% sequentially and more than 37% year over year, Yang said. The company cited demand for voltage-translation ICs, power-management products, networking devices, power protection, motor control, automotive lighting and electrification-related components. Industrial revenue grew 5% sequentially and more than 24% from a year earlier. Yang said demand was supported by AI infrastructure, automation, robotics, energy management, healthcare and smart-infrastructure applications. The company also pointed to the shift toward 400-volt and 800-volt power architectures in AI-related applications as a potential driver for its power-management and discrete-product portfolios. Computing revenue rose 18% sequentially and 33% year over year, making it the company’s strongest growth driver, according to Yang. She said Diodes secured multiple server-platform design wins for clock generators and timing solutions as customers transition to newer PCI Express architectures. New timing products are ramping into AI-server platforms, she added. Consumer revenue increased almost 10% sequentially and 17% year over year, though Yang said the overall market remained affected by memory shortages and slower demand. Communication revenue declined 7% sequentially and about 3% year over year, reflecting softer Chinese smartphone demand. Networking demand remained strong, Yang said, aided by investment in AI infrastructure and enterprise networking. Yu also discussed Diodes’ proposed acquisition of Elevate Semiconductor, a fabless semiconductor company focused on integrated circuits for automated test equipment. He said the acquisition would add a higher-margin product line centered on low-power, high-density signal-chain amplifiers and data converters, complementing Diodes’ analog and mixed-signal portfolio. The company expects the transaction to be immediately accretive and to add roughly $15 million of revenue in the first 12 months after closing. Yu said Elevate’s revenue is expected to grow at a compound annual rate above 20% over the following four years, with gross margin “significantly higher” than Diodes’ corporate average. On manufacturing, Yu said Diodes is increasing utilization at its wafer fabs, migrating some production from six-inch to eight-inch wafers and using external partners in Korea and Taiwan to add capacity. He said the company performs about 75% of assembly and testing internally and is selectively expanding capacity for packages including DFN and CSP. Diodes currently produces about half of its wafers internally and sources the other half externally, he said. Yang said channel inventory declined both in dollars and weeks during the quarter and remained below the company’s normal range of 11 to 14 weeks. In response to a question about potential double ordering, she said the company did not see evidence of double booking or shipments building channel inventory. Diodes Incorporated (NASDAQ: DIOD) is a global manufacturer and supplier of high‐performance discrete, logic, analog and mixed‐signal semiconductor products. Headquartered in Plano, Texas, the company designs and develops a broad range of discrete components, standard logic functions, power management circuits, interface products and array products. Its portfolio includes rectifiers, MOSFETs, general‐purpose diodes, voltage regulators, comparators, buffers and other building blocks for electronic systems. Diodes Incorporated serves a variety of end markets such as automotive, computing, communications, consumer electronics, industrial and lighting. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Diodes Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Revenue: $445.5 million in Q2 2026, up 22% year-over-year and 10% sequentially. Gross Profit/Margin: Gross profit of $147.6 million, with gross margin at 33.1%, up 160 basis points year-over-year. GAAP Net Income: $46.6 million, or $1.00 per diluted share. Non-GAAP Adjusted Net Income: $32.5 million, or $0.70 per diluted share. Non-GAAP Operating Expenses: $108.6 million, or 24.4% of revenue. EBITDA: $83.5 million, or 18.7% of revenue. Cash Flow: Operating cash flow of $68.5 million; free cash flow of $34.8 million. Capital Expenditures: $33.6 million, or 7.5% of revenue. Inventory: Total inventory days decreased to 152 from 157 last quarter; finished goods days were 51. Automotive Revenue: Record level, representing 21% of product revenue; grew 15% sequentially and over 37% year-over-year. Industrial Revenue: Grew 5% sequentially and over 24% year-over-year; represented 23% of product revenue. Computing Revenue: Grew 18% sequentially and 33% year-over-year; represented 28% of product revenue. Consumer Revenue: Increased almost 10% sequentially and 17% year-over-year; represented 17% of product revenue. Communication Revenue: Decreased 7% sequentially and approximately 3% year-over-year; represented 11% of product revenue. Q3 2026 Guidance: Revenue expected to be approximately $510 million, plus or minus 3%; GAAP gross margin expected to expand to 35%, plus or minus 1%; non-GAAP adjusted EPS expected to be $1.05, plus or minus. Warning! GuruFocus has detected 5 Warning Signs with DIOD. Is DIOD fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Revenue grew 22% year-over-year and 10% sequentially, marking the sixth consecutive quarter of double-digit growth. Automotive revenue hit a record 21% of product revenue, with strong market share gains across regions. Gross margin expanded 160 basis points year-over-year, with another 190 basis point sequential improvement expected in Q3. Non-GAAP EPS more than doubled year-over-year, with Q3 guidance implying a 2.8x year-over-year increase. The proposed acquisition of Elevate Semiconductor is expected to be immediately accretive, adding ~$50 million in revenue and expanding into the high-growth ATE market. Communication market revenue declined 7% sequentially and 3% year-over-year due to soft smartphone demand in China. Consumer market remains challenged by memory shortages and slower demand, limiting growth potential. Channel inventory is below the normal range, indicating potential supply constraints that could limit near-term shipments. The company faces pockets of supply constraints, particularly in power products, which could hinder ability to fully meet strong demand. Total inventory days remain high at 152, with increased raw material and work-in-process levels, posing a risk of excess inventory if demand softens. Q: Can you provide some color on your SPFAB status of revenue and profitability, utilization, and getting products qualified and moved in-house?A: Gary Yu (CEO): We don't provide a P&L for that particular wafer fab, but the progress on loading that wafer fab is continuing to grow. Key customers are starting to use wafers produced from the fab, and we believe utilization will continue to grow in the near future. Q: Can you talk us through end-market expectations as we move into Q3 and potentially Q4, and rank your growth opportunities as you move into 2027?A: Emily Yang (SVP, Worldwide Sales and Marketing): For Q3, we expect growth from almost all end-market segments, driven mainly by AI-related applications, especially server motherboards. Automotive shows strong growth momentum from market share gains, and industrial is recovering from excess inventory. Consumer is typically a peak quarter in Q3, and networking should continue to grow. We don't provide Q4 guidance, but momentum is good, and next year should be stronger than usual. Q: Some of your peers have reported constraints, notably for power product supply. Are you seeing any supply constraints, and will you be able to ship more without it, notably into data centers?A: Emily Yang (SVP, Worldwide Sales and Marketing): There are definitely pockets of areas that are more constrained than others due to very strong demand. Our focus is working with strategic customers to understand their true demand and prevent shortages or line-down issues. Gary Yu (CEO) added that leveraging the hybrid model, including internal wafer fabs and external partners, ensures capacity to support customers, with growth not limited by demand but supported by additional capacity. Q: You mentioned capacity expansion efforts. Is that on the front end, and if so, what geographically are you building capacity?A: Gary Yu (CEO): We are improving utilization at our fabs and migrating from 6-inch to 8-inch wafers for more capacity, while also leveraging external partners in Korea and Taiwan. For assembly and testing, about 75% is done internally. We are selectively adding capacity for specific packages like DFN or CSP, which provide better value and service to key customers. Q: What's the percentage of your production that's currently internal fab versus outsourced?A: Gary Yu (CEO): It's about 50-50 at this moment. Q: Can you talk through the rationale for the recent Elevate Semiconductor acquisition and any aspects we might not be thinking of?A: Gary Yu (CEO): Elevate is a fabless semiconductor company specializing in ICs for automated test equipment (ATE). It complements our analog and mixed-signal portfolio with highly differentiated IP and higher-margin products, including low-power, high-density signal chain and data converters. We see strong product and market synergies, expanding our exposure to the attractive ATE market and enabling us to become an ATE platform solution provider. The combined addressable market is estimated at $1 billion or more. Q: Given the strength of demand, do you feel you're shipping through consumption, and are there any concerns about double ordering or channel inventory building?A: Emily Yang (SVP, Worldwide Sales and Marketing): Channel inventory decreased both in dollars and weeks, and is lower than the normal range of 11 to 14 weeks. We don't see double booking or double shipments building up channel inventory at this moment. We are trying to balance ship-through, but we're not there yet, so this is not a concern. Q: Can you provide more color on the Q3 guidance, particularly the expected 14% sequential revenue growth and 190 basis point gross margin improvement?A: Brett Whitmire (CFO): For Q3, we expect revenue of approximately $510 million, plus or minus 3%, representing a 30% year-over-year increase and 14% sequential increase. GAAP gross margin is expected to expand to 35%, plus or minus 1%, driven by continued utilization improvements. Non-GAAP adjusted EPS is expected to be $1.05, plus or minus. Q: Can you elaborate on the AI infrastructure opportunity and how it's impacting your end markets?A: Emily Yang (SVP, Worldwide Sales and Marketing): AI infrastructure is becoming an increasingly important growth driver spanning multiple end markets. In a typical AI infrastructure platform, our content can attach across server motherboards, power networks, networking switches, storage, and high-speed optical interconnect. The estimated total content opportunity is approximately $266, a meaningful increase compared to $109 for AI server platforms alone. With several new products scheduled for release, we are well positioned to expand content and gain share as AI platforms scale in power density and complexity. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Revenue growth of 22% year-over-year was driven by strengthening demand across all regions and expanding content in automotive, industrial, and AI server applications. Automotive revenue reached a record 21% of product revenue, fueled by market share gains and increased semiconductor content per vehicle across both ICE and EV platforms. Gross margin expansion of 160 basis points year-over-year reflects the measurable benefits of cost and operating initiatives implemented during the previous market slowdown. The proposed acquisition of ElevATE Semiconductor marks a strategic entry into the Automated Test Equipment (ATE) market, targeting high-margin, complex IC solutions for production testing. Management attributes the 10% sequential revenue increase to record global POS, particularly in Asia and North America, indicating robust end-market consumption. The company is leveraging a hybrid manufacturing model, utilizing internal fabs like SPFAB while maintaining a 50-50 split between internal and outsourced production to manage capacity. Third quarter guidance anticipates 30% year-over-year revenue growth and a 190 basis point sequential improvement in gross margin as utilization rates continue to rise. The ElevATE acquisition is expected to be immediately accretive, contributing approximately $50 million in revenue over the first 12 months with a projected 20% CAGR over four years. Management is actively migrating production from 6-inch to 8-inch wafers to increase internal capacity and support long-term demand forecasts. The company remains on track toward its 3-year financial goals of $2 billion in annual revenue and over $4 in non-GAAP EPS. AI infrastructure is viewed as a broad ecosystem growth driver, with total content opportunity estimated at $267 per platform across servers, networking, and storage. Channel inventory remains below the normal range of 11 to 14 weeks, suggesting that current shipments are trailing actual consumption rather than building excess stock. Supply disruptions continue in certain pockets, prompting management to prioritize strategic customers and closely monitor true demand to prevent line-down issues. Inventory dollars increased by $11.8 million sequentially to support expected growth and mitigate longer wafer manufacturing lead times. The communication market remains a relative headwind, with revenue decreasing 7% sequentially due to soft smartphone demand in China. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted that loading at the wafer fab continues to grow, with key customers now starting to use products manufactured at the site. While specific P&L details for the fab were not disclosed, utilization is expected to continue increasing in the near future. Management acknowledged pockets of supply constraints due to strong demand but emphasized their ability to add capacity through the hybrid manufacturing model. Expansion efforts are focused on internal 8-inch migrations and selective investments in advanced packaging like QFN and CSP. The acquisition provides highly differentiated IP in the signal chain, including amplifiers and data converters, which carry margins significantly higher than the corporate average. It expands Diodes' addressable market by over $1 billion by moving the company from a component provider to an ATE platform solution provider.

Extends Growth Momentum in 2Q with Revenue Increasing over 20% and non-GAAP EPS Up over 100% YoY PLANO, Texas, August 05, 2026--(BUSINESS WIRE)--Diodes Incorporated (Diodes) (Nasdaq: DIOD) today reported its financial results for the second quarter ended June 30, 2026. Second Quarter Highlights Revenue was $445.5 million, compared to $366.2 million in the second quarter 2025 and $405.5 million in the prior quarter; GAAP gross profit was $147.6 million, compared to $115.3 million in the second quarter 2025 and $128.8 million in the prior quarter; GAAP gross profit margin was 33.1 percent, compared to 31.5 percent in the second quarter 2025 and 31.8 percent in the prior quarter; GAAP net income was $46.6 million, compared to GAAP net income of $46.1 million in the second quarter 2025 and GAAP net income of $15.0 million in the prior quarter; Non-GAAP adjusted net income was $32.5 million, compared to $15.0 million in the second quarter 2025 and $19.8 million in the prior quarter; GAAP EPS was $1.00 per diluted share, compared to GAAP EPS of $0.99 per diluted share in the same quarter a year ago and GAAP EPS of $0.32 per diluted share in the prior quarter; Non-GAAP EPS was $0.70 per diluted share, compared to $0.32 per diluted share in the second quarter 2025 and $0.43 per diluted share in the prior quarter; Excluding $8.9 million, net of tax, non-cash share-based compensation expense, both GAAP net income and non-GAAP adjusted net income would have increased by $0.19 per diluted share; EBITDA was $83.5 million, or 18.7 percent of revenue, compared to $84.5 million, or 23.1 percent of revenue in the same quarter a year ago and $49.4 million, or 12.2 percent of revenue in the prior quarter; Achieved $68.5 million cash flow from operations and $34.8 million of free cash flow, including $33.6 million of capital expenditures. Net cash flow was a positive $32.9 million, which includes $10.0 million for the stock buyback program. Commenting on the results, Gary Yu, President and CEO of Diodes, stated, "We extended our momentum in the second quarter with revenue again increasing more than 20% year-over-year, driven by growth across all regions. Revenue also increased 10% sequentially coupled with record global POS. As the sixth consecutive quarter of double-digit year-over-year growth, this quarter serves as further confirmation of strengthening demand in the overall market combined with Diodes expanding content across our analog and power solutions in our key focus areas of automotive, industrial and AI server-related applications. "Additionally, the cost and operating initiatives we previously implemented during the market slowdown are producing measurable benefits to gross margin and our bottom line, with margin increasing 160 basis points year-over-year and non-GAAP earnings increasing by more than 100% again this quarter. These actions have also contributed to increased cash flow that has enabled us to reinvest in our growth and innovation, while also looking for inorganic opportunities to expand our technology portfolio, such as the recent proposed acquisition of ElevATE Semiconductor. "As we look to the third quarter, we expect to extend our accelerating traction with revenue anticipated to increase 30% year-over-year and 14% sequentially at the mid-point. We also expect to deliver another 190-basis point sequential improvement in gross margin as our utilization continues to improve, combined with a 2.8 times year-over-year improvement in non-GAAP earnings. These expected results drive us closer toward our 3-year financial goals of $2 billion in annual revenue and over $4.00 in non-GAAP EPS." Second Quarter 2026 Revenue for second quarter 2026 was $445.5 million, compared to $366.2 million in the second quarter 2025 and $405.5 million in the prior quarter. GAAP gross profit for the second quarter 2026 was $147.6 million, or 33.1 percent of revenue, compared to $115.3 million, or 31.5 percent of revenue, in the second quarter 2025 and $128.8 million, or 31.8 percent of revenue, in the prior quarter. GAAP operating expenses for second quarter 2026 were $114.3 million, or 25.6 percent of revenue, and on a non-GAAP basis were $108.6 million, or 24.4 percent of revenue, which excludes $3.9 million acquisition-related intangible asset cost, $1.5 million of board/officer retirement expense and $0.3 million of acquisition-related costs. GAAP operating expenses in the second quarter 2025 were $105.9 million, or 28.9 percent of revenue and $109.0 million, or 26.9 percent of revenue, in the first quarter 2026. Second quarter 2026 GAAP net income was $46.6 million, or $1.00 per diluted share, compared to GAAP net income in the second quarter 2025 of $46.1 million, or $0.99 per diluted share, and GAAP net income in the prior quarter of $15.0 million, or $0.32 per diluted share. Second quarter 2026 non-GAAP adjusted net income was $32.5 million, or $0.70 per diluted share, which excluded, net of tax, an $18.7 million gain on investments, $3.2 million of acquisition-related intangible asset amortization cost, $1.2 million of board/officer retirement expense, and $0.2 million of acquisition-related costs. This compares to non-GAAP adjusted net income of $15.0 million, or $0.32 per diluted share, in the second quarter 2025 and $19.8 million, or $0.43 per diluted share, in the prior quarter. The following is an unaudited summary reconciliation of GAAP net income to non-GAAP adjusted net income and per share data, net of tax (in thousands, except per share data): Note: Throughout this release, we refer to "net income/loss attributable to common stockholders" as "net income/loss." (See the reconciliation tables of GAAP net income to non-GAAP adjusted net income near the end of this release for further details.) Included in second quarter 2026 GAAP and non-GAAP adjusted net income was approximately $8.9 million, net of tax, non-cash share-based compensation expense. Excluding share-based compensation expense, GAAP earnings per share ("EPS") and non-GAAP adjusted EPS would have increased by $0.19 per share for the second quarter 2026, compared to $0.10 for the second quarter 2025 and $0.13 per share in the prior quarter. EBITDA (a non-GAAP measure), which represents earnings before net interest expense, income tax, depreciation and amortization, in the second quarter 2026 was $83.5 million, or 18.7 percent of revenue, compared to $84.5 million, or 23.1 percent of revenue, in the second quarter 2025 and $49.4 million, or 12.2 percent of revenue, in the prior quarter. For a reconciliation of GAAP net income to EBITDA, see the table near the end of this release for further details. For the second quarter 2026, net cash provided by operating activities was $68.5 million. Net cash flow was positive $32.9 million, which includes $10.0 million for the stock buyback program. Free cash flow (a non-GAAP measure) was $34.8 million, which includes $33.6 million of capital expenditures. Balance Sheet As of June 30, 2026, the Company had approximately $442 million in cash and cash equivalents, restricted cash, and short-term investments. Total debt (including long-term and short-term) amounted to approximately $40 million and working capital was approximately $931 million. The results announced today are preliminary and unaudited, as they are subject to the Company finalizing its closing procedures and completion of the quarterly review by its independent registered public accounting firm. As such, these results are subject to revision until the Company files its Form 10-Q for the quarter ending June 30, 2026. Business Outlook Gary Yu further commented, "For the third quarter of 2026, we expect revenue to increase to approximately $510 million, plus or minus 3 percent, representing a 30 percent increase year-over-year and a 14 percent increase sequentially at the mid-point. GAAP gross margin is expected to expand to 35.0 percent, plus or minus 1 percent. Non-GAAP adjusted EPS is expected to be $1.05, plus or minus $0.10." A reconciliation of our forward-looking non-GAAP EPS to the most directly comparable GAAP measures is not provided because such items cannot be reasonably calculated without unreasonable efforts due to the unpredictability of the amounts and timing of events affecting the items we exclude, including acquisition-related intangible asset costs, board member/officer retirements, acquisition-related costs, restructuring costs, gain/loss on investment, non-cash mark-to-market investment adjustments, impairment of equity investment, and other charges. Conference Call Diodes will host a conference call on Wednesday August 5, 2026 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its second quarter financial results. Investors and analysts may join the conference call by dialing 1-800-715-9871 (international callers should dial +1-646-307-1963) and then enter passcode 5168100. A telephone replay of the call will be made available approximately two hours after the call and will remain available until August 12, 2026 at midnight Central Time. The replay number is 1-855-669-9658 with an access code of 1081985 followed by the # key. International callers should dial +1-412-317-0088 and enter the same access code at the prompt followed by the # key. Additionally, this conference call will be broadcast live over the Internet and can be accessed by all interested parties on the Investor Relations section of the Company’s website. To listen to the live call, please go to the investors’ section of Diodes’ website and click on the conference call link at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those unable to participate during the live broadcast, a replay will be available shortly after the call on Diodes' website for approximately 90 days. About Diodes Incorporated Diodes Incorporated (Nasdaq: DIOD), delivers high-quality semiconductor products to the world’s leading companies in the automotive, industrial, computing, consumer electronics, and communications markets. We leverage our expanded product portfolio of analog and power solutions combined with a flexible hybrid manufacturing model to meet customers’ needs. Our broad range of application-specific products, delivered through a total solutions sales approach and supported by global operations including engineering, testing, manufacturing, and customer service, enable us to be a premier provider for high-growth markets. For more information, visit www.diodes.com. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Any statements set forth above that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such statements include statements containing forward-looking words such as "expect," "anticipate," "aim," "estimate," and variations thereof, including without limitation statements, whether direct or implied, regarding expectations of that for the third quarter of 2026, we expect revenue to be approximately $510 million plus or minus 3 percent; we expect GAAP gross margin to be 35.0 percent, plus or minus 1 percent; and non-GAAP adjusted EPS to be $1.05, plus or minus $0.10. Potential risks and uncertainties include, but are not limited to, such factors as: the risk that such expectations may not be met; the risk that the expected benefits of acquisitions may not be realized or that integration of acquired businesses may not continue as rapidly as we anticipate; the risk that we may not be able to maintain our current growth strategy or continue to maintain our current performance, costs, and loadings in our manufacturing facilities; the risk that we may not be able to increase our automotive, industrial, or other revenue and market share; risks of domestic and foreign operations, including excessive operating costs, labor shortages, higher tax rates, and our joint venture prospects; the risks of cyclical downturns in the semiconductor industry and of changes in end-market demand or product mix that may affect gross margin or render inventory obsolete; the risk of unfavorable currency exchange rates; the risk that our future outlook or guidance may be incorrect; the risks of global economic weakness or instability in global financial markets; the risks of trade restrictions, tariffs, or embargoes; the risk of breaches of our information technology systems; and other information, including the "Risk Factors" detailed from time to time in Diodes’ filings with the United States Securities and Exchange Commission. The Diodes logo is a registered trademark of Diodes Incorporated in the United States and other countries. © 2026 Diodes Incorporated. All Rights Reserved. ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE The Company’s financial statements present net income and earnings per share that are calculated using accounting principles generally accepted in the United States ("GAAP"). The Company’s management makes adjustments to the GAAP measures that it feels are necessary to allow investors and other readers of the Company’s financial releases to view the Company’s operating results as viewed by the Company’s management, board of directors and research analysts in the semiconductor industry. These non-GAAP measures are not prepared in accordance with, and should not be considered alternatives or necessarily superior to, GAAP financial data and may be different from non-GAAP measures used by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies’ non-GAAP financial measures, even if they have similar names. The explanation of the adjustments made in the table above, are set forth below: Detail of non-GAAP adjustments Amortization of acquisition-related intangible assets – The Company excluded this item, including amortization of developed technologies and customer relationships. The fair value of the acquisition-related intangible assets is amortized using straight-line methods which approximate the proportion of future cash flows estimated to be generated each period over the estimated useful life of the applicable assets. The Company believes that exclusion of this item is appropriate because a significant portion of the purchase price for its acquisitions was allocated to the intangible assets that have short lives and exclusion of the amortization expense allows comparisons of operating results that are consistent over time for both the Company’s newly acquired and long-held businesses. In addition, the Company excluded this item because there is significant variability and unpredictability among companies with respect to this expense. Board member/Officer retirement – The Company excluded costs related to (1) the retirement of a board member, these costs represent cash payments and the accelerated vesting of previously issued stock awards, (2) the retirement of an officer, these costs represent cash payments and the accelerated vesting of previously issued stock awards. The Company feels it is appropriate to exclude these costs since they don’t represent ongoing operating expenses and will present investors with a more accurate indication of our continuing operations. (Gain) Loss on Investment – The Company excluded gains and losses on various investments, as well as impairment and mark-to-market adjustments on equity investments. The Company believes these amounts are not reflective on the ongoing operations of the Company and exclusion of these items, provides investors an enhanced view of the Company’s operating results. Acquisition related costs – The Company excluded expenses associated with previous acquisitions of that typically consist of advisory, legal and other professional and consulting fees. These costs were expensed as they were incurred and as services were received, and in which the corresponding tax adjustments were made for the non-deductible portions of these expenses. The Company believes the exclusion of the acquisition-related costs provides investors with a more accurate reflection of costs likely to be incurred in the absence of an unusual event such as an acquisition and facilitates comparisons with the results of other periods that may not reflect such costs. Restructuring charge – The Company recorded restructuring charges related to various locations. These restructuring charges are excluded from management’s assessment of the Company’s operating performance. The Company believes the exclusion of the restructuring charges provides investors an enhanced view of the cost structure of the Company’s operations and facilitates comparisons with the results of other periods that may not reflect such charges or may reflect different levels of such charges. Gain on disposal of subsidiary – The Company excluded the gain on the disposal of a subsidiary. The Company believes this is not reflective of the ongoing operations and exclusion of this item provides investors an enhanced view of the Company’s operating results. CASH FLOW ITEMS Free cash flow (FCF) (Non-GAAP) FCF for the second quarter of 2026 is a non-GAAP financial measure, which is calculated by subtracting capital expenditures from cash flow from operations. For the second quarter of 2026, FCF was $34.8 million, which represents the cash and cash equivalents that we are able to generate after taking into account cash outlays required to maintain or expand property, plant and equipment. FCF is important because it allows us to pursue opportunities to develop new products, make acquisitions and reduce debt. CONSOLIDATED RECONCILIATION OF NET INCOME TO EBITDA EBITDA represents earnings before net interest expense, income tax provision, depreciation and amortization. Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties, such as financial institutions in extending credit, in evaluating companies in our industry and provides further clarity on our profitability. In addition, management uses EBITDA, along with other GAAP and non-GAAP measures, in evaluating our operating performance compared to that of other companies in our industry. The calculation of EBITDA generally eliminates the effects of financing, operating in different income tax jurisdictions, and accounting effects of capital spending, including the impact of our asset base, which can differ depending on the book value of assets and the accounting methods used to compute depreciation and amortization expense. EBITDA is not a recognized measurement under GAAP, and when analyzing our operating performance, investors should use EBITDA in addition to, and not as an alternative for, income from operations and net income, each as determined in accordance with GAAP. Because not all companies use identical calculations, our presentation of EBITDA may not be comparable to similarly titled measures used by other companies. For example, our EBITDA takes into account all net interest expense, income tax provision, depreciation and amortization without taking into account any amounts attributable to noncontrolling interest. Furthermore, EBITDA is not intended to be a measure of free cash flow for management’s discretionary use, as it does not consider certain cash requirements such as tax and debt service payments. The following table provides a reconciliation of net income to EBITDA (in thousands, unaudited): View source version on businesswire.com: https://www.businesswire.com/news/home/20260805537945/en/ Contacts Company Contact: Diodes IncorporatedGurmeet DhaliwalVice President, Corporate Marketing & IRP: 408-232-9003E: [email protected] Investor Relations Contact: Shelton GroupLeanne SieversPresident, Investor RelationsP: 949-224-3874E: [email protected]

PLANO, Texas, July 15, 2026--(BUSINESS WIRE)--Diodes Incorporated (Nasdaq: DIOD) will host a conference call on Wednesday, August 5, 2026 at 4:00 p.m. Central Time (5:00 p.m. Eastern Time) to discuss its second quarter 2026 financial results. Joining Gary Yu, President and Chief Executive Officer of Diodes Incorporated, will be Brett Whitmire, Chief Financial Officer, and Emily Yang, Senior Vice President of Worldwide Sales and Marketing. The Company intends to distribute the announcement of its second quarter 2026 financial results on that same day at 3:05 p.m. Central Time (4:05 p.m. Eastern Time). Analysts and investors are invited to join the conference call using the following information: Date: Wednesday, August 5, 2026Time: 4:00 p.m. Central Time (5:00 p.m. Eastern Time)Conference Call Number: 1-800-715-9871International Call Number: +1-646-307-1963Passcode: 5168100 A telephone replay of the conference call will be available approximately two hours after the conference call and will be available through August 12, 2026. The replay dial-in number is 1-855-669-9658, and the pass code 1081985. International callers should dial +1-412-317-0088 and enter the same pass code. Additionally, this conference call will be broadcast live over the Internet and can be accessed by all interested parties on the Investor Relations section of the Company’s website. For those unable to participate during the live broadcast of the conference call, a replay webcast will be available shortly thereafter on the Company’s website for approximately 90 days. About Diodes Incorporated Diodes Incorporated (Nasdaq: DIOD), delivers high-quality semiconductor products to the world’s leading companies in the automotive, industrial, computing, consumer electronics, and communications markets. We leverage our expanded product portfolio of analog and power solutions combined with a flexible hybrid manufacturing model that meet customers’ needs. Our broad range of application-specific products, delivered through a total solutions sales approach and supported by global operations including engineering, testing, manufacturing, and customer service, enable us to be a premier provider for high-growth markets. For more information, visit www.diodes.com. The Diodes logo is a registered trademark of Diodes Incorporated in the United States and other countries. © 2026 Diodes Incorporated. All Rights Reserved. View source version on businesswire.com: https://www.businesswire.com/news/home/20260715369470/en/ Contacts Company Contact: Diodes IncorporatedGurmeet DhaliwalVice President, IR & Corporate MarketingP: 408-232-9003E: [email protected] Investor Relations Contact: Shelton GroupLeanne SieversPresident, Investor RelationsE: [email protected]

Track your investments for FREE with Simply Wall St, the portfolio command center trusted by over 7 million individual investors worldwide. Diodes (DIOD) is back on investors’ radar after first quarter 2026 results showed higher sales and a swing to profit, paired with second quarter revenue guidance that points to continued business momentum. See our latest analysis for Diodes. At a share price of $97.15, Diodes has a 1 day share price return of 3.63% and a 90 day share price return of 44.48%. The 1 year total shareholder return of 106.26% reflects strong recent momentum despite some short term pullbacks. If Diodes has caught your interest, this could be a good moment to see what else is moving in chip related supply chains using our 45 AI infrastructure stocks With quarterly revenue at $405.47 million, fresh guidance pointing to higher sales, and the stock sitting below an average analyst price target of $129.50, is there still upside on the table, or is the market already pricing in future growth? Compared with the latest fair value narrative of $75.67, Diodes closing at $97.15 sits well above that estimate, which frames the current debate. Read the complete narrative. Curious what kind of revenue ramp, margin lift, and future earnings multiple support that $75.67 fair value when the stock already trades higher? The full narrative spells out those assumptions in detail. Result: Fair Value of $75.67 (OVERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, high exposure to cyclical consumer demand and concentrated revenue in Asia could quickly challenge the current fair value story if conditions shift. Find out about the key risks to this Diodes narrative. Given that the picture here includes both concerns and reasons for optimism, it makes sense to review the details now and form your own view with the 3 key rewards and 2 important warning signs If Diodes has sharpened your focus, do not stop here. The screener can quickly surface fresh ideas that fit the way you like to invest. Target steady compounding potential by reviewing companies in the 51 high quality undervalued stocks that combine quality fundamentals with prices below their estimated worth. Prioritize resilience by checking out the 67 resilient stocks with low risk scores and focus on stocks with lower risk scores that may better suit cautious capital. Hunt for underfollowed opportunities with the screener containing 21 high quality undiscovered gems where quieter stocks with solid metrics might not yet be widely followed. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DIOD. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Diodes Incorporated (NASDAQ:DIOD) announced strong profits, but the stock was stagnant. Our analysis suggests that shareholders have noticed something concerning in the numbers. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. For anyone who wants to understand Diodes' profit beyond the statutory numbers, it's important to note that during the last twelve months statutory profit gained from US$46m worth of unusual items. While we like to see profit increases, we tend to be a little more cautious when unusual items have made a big contribution. When we analysed the vast majority of listed companies worldwide, we found that significant unusual items are often not repeated. Which is hardly surprising, given the name. We can see that Diodes' positive unusual items were quite significant relative to its profit in the year to March 2026. All else being equal, this would likely have the effect of making the statutory profit a poor guide to underlying earnings power. That might leave you wondering what analysts are forecasting in terms of future profitability. Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates. As we discussed above, we think the significant positive unusual item makes Diodes' earnings a poor guide to its underlying profitability. As a result, we think it may well be the case that Diodes' underlying earnings power is lower than its statutory profit. The silver lining is that its EPS growth over the last year has been really wonderful, even if it's not a perfect measure. Of course, we've only just scratched the surface when it comes to analysing its earnings; one could also consider margins, forecast growth, and return on investment, among other factors. So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. Case in point: We've spotted 3 warning signs for Diodes you should be mindful of and 1 of them doesn't sit too well with us. Today we've zoomed in on a single data point to better understand the nature of Diodes' profit. But there are plenty of other ways to inform your opinion of a company. For example, many people consider a high return on equity as an indication of favorable business economics, while others like to 'follow the money' and search out stocks that insiders are buying. While it might take a little research on your behalf, you may find this free collection of companies boasting high return on equity, or this list of stocks with significant insider holdings to be useful. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.