Tower Semiconductor Ltd

Tower Semiconductor delivered a mixed third quarter for fiscal 2026, posting results that fell short of Wall Street expectations on both the top and bottom lines despite meaningful year-over-year growth. GAAP EPS came in at $0.79, missing the $1.06 consensus by 25.25%, while revenue of $460.08 million trailed the $522.77 million estimate by 11.99%, ending a five-quarter streak of consecutive EPS beats. That said, revenue still climbed 16.3% from the year-ago period, driven largely by a richer product mix weighted toward Silicon Photonics shipments, which helped lift gross margins to roughly 29.9% from 21.5% a year earlier. The company's aggressive capacity build-out, reflected in $342.95 million in capital expenditures during the first half of 2026, signals confidence in future demand, and that conviction appears shared by customers, with long-term customer advances surging to $145.37 million from just $1.93 million at year-end 2025. Looking ahead, Tower issued a record Q3 revenue forecast of $520 million and raised its 2028 targets to $3.60 billion in revenue, underpinned by customer commitments tied to expanding SiPho and SiGe capacity in Japan with METI grant support.