Magnachip Semiconductor Corp. (MX)

Magnachip designs and makes power semiconductors, the chips that switch and convert electricity inside electronics. Power Analog Solutions, 89.7% of 2025 revenue, are discrete power switches: MOSFETs, which switch, shape or transfer electricity, and IGBTs for higher-power uses. Power IC, 10.3%, covers AC-DC and DC-DC converters, LED drivers, regulators, power management chips (PMICs) and level shifters, sold mainly to makers of televisions and large display panels. Its chips go into televisions, phones, PCs, servers, appliances, cars and industrial gear such as e-bikes, solar inverters and motor drives; it sold about 350 distinct products in 2025. 192021222324

How it operates

Magnachip designs and makes power semiconductors, the chips that switch and convert electricity inside electronics. Power Analog Solutions, 89.7% of 2025 revenue, are discrete power switches: MOSFETs, which switch, shape or transfer electricity, and IGBTs for higher-power uses. Power IC, 10.3%, covers AC-DC and DC-DC converters, LED drivers, regulators, power management chips (PMICs) and level shifters, sold mainly to makers of televisions and large display panels. Its chips go into televisions, phones, PCs, servers, appliances, cars and industrial gear such as e-bikes, solar inverters and motor drives; it sold about 350 distinct products in 2025. 192021222324

It sells to electronics makers, contract manufacturers and subsystem designers, mostly through agents and distributors, which handled 66% of 2025 Power Solutions sales, down from 77%. The ten largest customers took 74.3%, and one, SAMT Co., Ltd., took 29.7%, up from 25.4%; its products reached 185 end customers. By billing location, Korea took 49.2% of Power Solutions sales and the rest of Asia Pacific 45.9%, while the United States accounted for only 5.0 million dollars. After a design win it often fixes a product's price for a set period and renegotiates from time to time, and its prices tend to fall over a product's life. 2526272829303132

It makes its power switches in its one fab, in Gumi, Korea, with capacity of about 36,000 eight-inch equivalent wafers a month at geometries of 0.13 to 0.35 microns, and also uses an outside foundry; Power IC wafers come from an independent foundry that allocates production at its own discretion. It leases facilities for administration, sales and research in Cheongju and Seoul, and its specialized raw materials come from a limited number of suppliers. 3334353637

It reports in U.S. dollars, but the business sits in Korea: the fall of the Korean won against the dollar caused foreign currency losses in 2024 and 2025, much of it on dollar loans to its Korean subsidiary. The Gumi fab also backs its borrowing from Korea Development Bank: about 27.9 million dollars of a working capital term loan is secured by a pledge of the fab's properties. 383940

The specifics

Magnachip was carved out of Hynix Semiconductor, now SK hynix, in October 2004, and completed its initial public offering in March 2011. It has since shed businesses: in September 2020 it sold its foundry services business and its Cheongju fab, known as Fab 4, to SK keyfoundry; in March 2025 it chose to become a pure-play power company, judging its display chip business not sustainable; it approved shutting that business in April 2025 and finished liquidating the subsidiary that ran it on October 29, 2025. 41424344454640

Its technical base, in its own telling: about 45 years of operating history, more than 950 registered patents and pending applications expiring over roughly the next 19 years, about 110 engineers, and know-how in ultra-high voltage, high voltage and deep trench BCDMOS, manufacturing processes that combine bipolar, CMOS and DMOS transistors on one chip, run on eight-inch wafer lines. It holds a patent cross-license with Infineon Technologies dating to 2017. In July 2026, after the annual report, it agreed to license silicon carbide (SiC) technology from Navitas Semiconductor to enter high-voltage and ultra-high-voltage SiC power markets, and to bring the technology into its own fab. 4748495051525354

It names no rival companies. It says it competes with independent and captive makers of analog and mixed-signal chips, with emerging companies, and with the in-house chip design and manufacturing of many of its own significant customers, and that pricing pressure on its older products is sharpest in China. 555657

Korean law shapes the plant. Under the Serious Accident Punishment Act of 2021, which makes companies and individuals criminally liable for serious industrial accidents, it appointed Seung Hoon Lee chief safety officer when the law took effect in January 2022, and its Korean subsidiary has been in the Korean Emissions Trading Scheme for greenhouse gases since 2015. 585960

What drives growth, line by line

Power Analog Solutions. The main line: 160.5 million dollars, 89.7% of 2025 revenue, down from 166.8 million. The filing blames competitive pricing pressure on older-generation products, particularly in China, partly offset by stronger demand for low-voltage MOSFETs in communication applications. The line's gross margin fell to 14.9% from 18.9%, on price erosion in China and a one-time incentive program for distributors there in the fourth quarter of 2025. 61576263

Power IC. 18.4 million dollars, 10.3% of revenue, down from 19.0 million. It earns a far richer gross margin than the power switches, 41.0%, down from 44.4%. 6162

Transitional Fab 3 foundry services. Foundry work for others at the Gumi fab brought in 10.6 million dollars in 2024 and nothing in 2025, having been phased out by the end of 2024. 6465

By region, Korea grew 10.2% to 88.0 million dollars on demand for power products such as low-voltage MOSFETs in communication applications, while the rest of Asia Pacific fell 16.9% to 82.0 million under price pressure on older products in consumer and industrial uses. 6667

In all, revenue fell 8.9% to 178.9 million dollars, the fifth yearly decline in a row on the record, from 507.1 million in 2020, though those years span the 2020 sale of the foundry business and the 2025 display shutdown, so they are not like for like. The operating loss widened to 35.9 million dollars from 26.0 million, while the net loss narrowed to 29.7 million from 54.3 million. 646843446970

What comes next, in the company's own words: it spent 30.0 million dollars on plant and equipment in 2025, 21.4 million of it upgrading the Gumi fab, which it expects to support new-generation products and improve gross margin; it plans to widen its customer base in China, Hong Kong and Taiwan while keeping capital spending relatively low. In June 2026 it set up a program to sell up to 50.0 million dollars of new shares over time, for purposes that may include technologies for AI data centers and robotics, and it expects the Navitas technology to serve energy and grid infrastructure, energy storage, industrial electrification and automotive systems. 71727374757654

The read's section on the people who run it is on the People tab.

What the desk infers Inferred

1. Inferred

   SAMT, which bought nearly three tenths of Power Solutions sales, is most likely a Korean distributor rather than a manufacturer, standing in front of large Korean electronics makers.

   Because

   • Two thirds of Power Solutions sales went through agents and distributors. 25
   • SAMT took 29.7% of Power Solutions sales, up from 25.4% the year before. 26
   • Korea, by billing location, took 49.2% of Power Solutions sales and grew 10.2% on demand for low-voltage MOSFETs in communication applications. 2966
   • The company says its Korean operations sit close to many of its largest customers. 77
   Confidence 60 of 100Wrong if A filing describing SAMT as a manufacturer that builds its own products with Magnachip's chips.
2. Inferred

   Magnachip's problem is price more than volume: its older power switches are being undercut, above all in China, so it is spending to upgrade Gumi for newer products rather than adding capacity for old ones.

   Because

   • The filing blames the Power Solutions decline on competitive pricing pressure on older-generation products, particularly in China. 57
   • Power Analog Solutions' gross margin fell to 14.9% from 18.9% on price erosion and a one-time incentive for distributors in China. 6263
   • Asia Pacific outside Korea fell 16.9% under that pressure, while Korea grew on low-voltage MOSFETs. 6766
   • Of 30.0 million dollars of 2025 capital spending, 21.4 million went to upgrading Gumi for new-generation products and better margins. 72
   • Its prices tend to fall over a product's life as new generations arrive. 32
   Confidence 70 of 100Wrong if A filing attributing the revenue decline mainly to lower unit volumes, or showing Power Analog Solutions margins recovering on older products alone.
3. Inferred

   The outside foundry that makes Power IC wafers is probably SK keyfoundry, running the Cheongju fab Magnachip sold it in 2020.

   Because

   • It sold its foundry business and its Cheongju fab, Fab 4, to SK keyfoundry in September 2020. 43
   • It began outsourcing 8-inch wafers for Power IC after that sale, for geometries its own fab cannot make. 78
   • The business it sold offered specialty analog and mixed-signal foundry services, and Power IC runs on standard BCD processes. 7980
   • Its only remaining fab is Gumi, at 0.13 to 0.35 microns. 33
   Confidence 45 of 100Wrong if A filing that names a company other than SK keyfoundry as the Power IC wafer foundry.