Photronics Inc. (NASDAQ:PLAB) reported its second-quarter fiscal 2026 financial results on Thursday morning, revealing a top- and bottom-line miss against Wall Street expectations.

The global photomask technology manufacturer experienced a minor year-over-year revenue contraction alongside sequential declines.

Q2 Results Miss Wall Street Expectations

For the three months ended May 3, Photronics reported non-GAAP net income attributable to shareholders of $24.9 million, or 42 cents per diluted share.

According to analyst consensus, the figure missed the estimated 54 cents per share. However, the performance marked a modest increase over the non-GAAP earnings of 40 cents per share reported in the same period last year.

Quarterly sales reached $209.940 million, down from $211 million in the second quarter of 2025. The revenue total fell short of the analyst consensus estimate of $216.661 million, according to Benzinga Pro.

Photronics Weak Q3 Guidance Raises Concerns

Looking ahead, Photronics guided for third-quarter revenue between $207 million and $215 million, below analyst expectations of $219.7 million.

The company expects non-GAAP diluted EPS attributable to shareholders between 39 cents and 45 cents, also well below the consensus estimate of 56 cents per share.

Photronics forecast third-quarter operating margins in the range of 18% to 20%.

On the balance sheet, Photronics reported cash and cash equivalents of $511.490 million at the close of the period on May 3, 2026.

Total cash, cash equivalents, and short-term investments stood at $637.7 million, with $477.3 million linked to its 50.01%-owned Joint Ventures.

IC Business Weakens While FPD Segment Holds Up

An internal breakdown of revenue revealed contrasting trajectories between the company’s core businesses. Integrated Circuit (IC) revenue dropped to $147.5 million, marking a 5% decrease year-over-year and an 11% contraction from the prior quarter.

Conversely, Flat Panel Display (FPD) revenue provided a bright spot, climbing 13% year-over-year and 4% sequentially to reach $62.4 million. Photronics generated $47 million from operating activities during the quarter and funneled $45.8 million back into organic growth through capital expenditures.

Photronics Management Points To Temporary Supply Bottlenecks

Chairman and CEO George Macricostas said several near-term industry challenges continue to pressure customer demand and product timing.

“Photomask market dynamics reflect a mix of supportive long-term drivers and several temporary headwinds,” Macricostas said. “Certain design releases have been delayed due to elevated fab utilization rates, extending new product launch timelines, memory supply constraints and related cost pressures for OEMs, and geopolitical uncertainty.”

PLAB Stock Price Activity: Photronics shares were down 28.27% at $38.38 during premarket trading on Thursday, according to Benzinga Pro data.

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