China's export controls on indium phosphide (InP), introduced in early February 2025, have triggered a supply crisis. China accounts for approximately 70% of global indium production, and the restrictions have led to a significant price surge for critical semiconductor materials.
The average price for six-inch InP wafers has increased by roughly 250% since the controls took effect, reaching approximately $5,000 per wafer. Lumentum's CEO warned that the supply-demand gap for InP could exceed 30%.
Despite these challenges, IQE Plc has seen growth. The company reported revenue of £64.6 million for the first half of 2026, a 43% increase compared to the same period last year. Adjusted EBITDA was £6.0 million.
To mitigate risks, IQE is converting existing manufacturing capacity to increase InP production in the second half of 2026. The company is also seeking long-term supply agreements and plans to move its listing to the London Stock Exchange Main Market in the first half of 2027.
