GCT Semiconductor Reports 85% Revenue Decline and $6.97 Million Net Loss in Q1 2025

GCT Semiconductor Holding, Inc. reported a significant decline in financial performance for the first quarter of 2025, with total net revenues falling to $496,000, an 85% decrease from $3.3 million in the same period last year. The company's product revenues plummeted by 96% to $91,000, attributed to a lack of platform shipments and a continued decline in demand for 4G products as customers transition to 5G technologies. Service revenues also decreased by 54% to $405,000, primarily due to the conclusion of a major service project and delays in new contracts.

The company's gross profit for the quarter was $88,000, down from $1.95 million a year earlier, reflecting a gross margin decrease to 18% from 60%. Operating expenses surged to $7.83 million, compared to a negative $5.28 million in the prior year, largely due to the absence of a one-time gain from extinguishing liabilities that had occurred in the previous fiscal year. Consequently, GCT reported a net loss of $6.97 million for the quarter, compared to a net income of $757,000 in the first quarter of 2024.

In terms of operational developments, GCT's employee headcount and customer base remained stable, with 48,473,433 shares of common stock outstanding as of May 9, 2025. The company continues to focus on its strategic initiatives, including the anticipated launch of its 5G product line in the second quarter of 2025, which is expected to significantly enhance revenue and gross margins. GCT is also pursuing additional financing options, including a recent at-market issuance sales agreement allowing for the sale of up to $75 million in common stock.

The company’s liquidity position remains precarious, with cash and cash equivalents totaling $1.04 million as of March 31, 2025. GCT has incurred substantial operating losses and negative cash flows, leading to an accumulated deficit of $569 million. Management has indicated that additional fundraising will be necessary to sustain operations, and there is substantial doubt about the company's ability to continue as a going concern without securing further financing.

Looking ahead, GCT Semiconductor is navigating a challenging market environment characterized by rapid technological changes and competitive pressures. The company is actively seeking to improve operational efficiencies and restore product sales volumes while preparing for the commercialization of its 5G chipsets. However, the ongoing need for significant capital investment and the potential for fluctuating market conditions pose risks to achieving its financial and operational objectives.