PER, EPS, PBR and BPS are calculated in-house from the last 4 quarters (2025Q3–2026Q2) · Dividend yield is based on ₩0 per share · Prices as of the 2026-10-02 close
ITM Semiconductor discontinued its Apple protection-circuit business in April 2026 and pivoted toward Samsung Electronics and e-cigarette products, but a sharp second-quarter revenue drop and Vietnam-subsidiary issues have put its profitability targets to the test.
On April 13, 2026, the company disclosed the discontinuation of its Apple protection-circuit supply, ending a relationship that accounted for 57.3% (KRW 345.8bn) of 2025 revenue.
Samsung-facing smartphone protection-circuit and e-cigarette businesses grew 31.9% and 24.8%, respectively, in the first half, partly offsetting the gap.
Second-quarter 2026 revenue plunged to KRW 3.4bn from KRW 132.2bn in the prior quarter, with net loss widening again to KRW 65.9bn, a discrepancy versus separately reported continuing-operations figures that warrants confirmation in the next filing.
The debt ratio jumped to 417.9% in 2025 from 206.2% a year earlier, with a Vietnam-subsidiary embezzlement case, capital injections, and debt guarantees adding to liquidity pressure.
Hana Securities, in a March 2026 report, suggested a possible turnaround with annual revenue of KRW 412.9bn and operating profit of KRW 10.4bn, citing reduced depreciation expense.
Founded in 2000, ITM Semiconductor specializes in secondary-battery protection circuits, mainly Protection Module Package (PMP) and POC devices, alongside battery pack and digital sensor businesses.
Per its FY2023 annual report, revenue mix was PMP 67.3%, POC 5.4%, e-cigarette products 16.5%, and battery packs/sensors and others 10.7%. Its major customers were global smartphone makers Apple and Samsung Electronics, with Apple-related revenue reaching KRW 345.8bn in 2025, or 57.3% of total revenue of KRW 603.1bn.
However, on April 13, 2026, the company disclosed the discontinuation of its smartphone protection-circuit supply to Apple, pursuing a profitability-focused restructuring by cutting low-margin business.
The Apple revenue gap is being filled by Samsung-facing smartphone protection circuits and e-cigarette devices/cartridges, with the e-cigarette business growing on expanded export sales through its Indonesian subsidiary.
Over the medium to long term, the company is building humanoid-robot battery pack and motor-controller development lines at headquarters and pursuing expansion into battery management systems (BMS), defense battery packs, and marine energy storage systems (ESS).
Its core manufacturing base is Vietnam, where it operates five factories, though a recent embezzlement case involving local staff has required additional capital support from headquarters.
Competitively, the company is reported to hold a leading global share in PMP, though customer concentration has long been flagged as a risk factor.
| Quarter | Revenue | Operating profit | Op. margin |
|---|---|---|---|
| 2025Q2 | ₩134.5B | ₩500M | 0.4% |
| 2025Q3 | ₩163.6B | ₩88,061,193 | 0.1% |
| 2025Q4 | ₩166.9B | -₩1.8B | −1.1% |
| 2026Q1 | ₩132.2B | -₩4.9B | −3.7% |
| 2026Q2 | ₩3.4B | -₩5.2B | −152.6% |
| Year | Revenue | Operating profit | Net income (parent) | Op. margin | ROE | Debt-to-equity |
|---|---|---|---|---|---|---|
| 2022 | ₩633.5B | -₩16.2B | -₩21.3B | −2.6% | −10.8% | 231.1% |
| 2023 | ₩580.5B | -₩14.9B | -₩33B | −2.6% | −17.7% | 222.4% |
| 2024 | ₩647.9B | ₩2.4B | ₩1.2B | 0.4% | 0.6% | 206.2% |
| 2025 | ₩603.1B | -₩7B | -₩93.6B | −1.2% | −98.9% | 417.9% |
Consolidated basis (financial statements including subsidiaries) · Final figures from DART filings · Net income attributable to owners of the parent · Data as of 2026-08-23
2025 consolidated revenue came to KRW 603.1bn, down 6.9% from KRW 647.9bn a year earlier, with an operating loss of KRW 7.0bn and a net loss attributable to owners of KRW 93.6bn.
The initially announced preliminary 2025 net loss was KRW 76.4bn, but this was revised to a final KRW 93.6bn after additional losses from the Vietnam-subsidiary embezzlement were recognized.
On a quarterly basis, the company briefly turned profitable in Q3 2025 with revenue of KRW 163.6bn, operating profit of KRW 0.09bn, and net profit of KRW 0.5bn, before deteriorating sharply in Q4 2025 to an operating loss of KRW 1.8bn and a net loss of KRW 69.1bn, when large one-off losses were concentrated.
Q1 2026 showed revenue of KRW 132.2bn, an operating loss of KRW 4.9bn, and a net loss of KRW 3.6bn, a narrower loss than the year-earlier period. However, following the termination of the Apple business in April, Q2 2026 revenue collapsed to just KRW 3.4bn, and the net loss widened again to KRW 65.9bn.
This diverges from the company's separately disclosed continuing-operations (ex-Apple) first-half revenue of KRW 135.7bn (up 10.7% year-on-year) and operating loss of KRW 10.1bn, a discrepancy that should be clarified in the next filing regarding consolidation scope or discontinued-operations classification.
By segment, Samsung-facing protection-circuit revenue rose 31.9% to KRW 41.8bn from KRW 31.7bn in the first half, while e-cigarette revenue grew 24.8% to KRW 75.5bn from KRW 60.5bn, with both core businesses posting double-digit growth.
Meanwhile, operating cash flow remained positive at KRW 23.7bn in 2025, but the debt ratio rose sharply to 417.9% from 206.2% a year earlier, increasing financial strain.
Secondary-battery protection circuits (PMP/POC) are essential safety components in smartphone batteries that major manufacturers require, and the company is reported to hold a leading global share in this segment.
The upstream smartphone market is heavily concentrated among a handful of customers such as Apple and Samsung, meaning volume changes at a single account can directly affect revenue, as illustrated by the recent Apple contract termination.
The heat-not-burn (HNB) e-cigarette market has been driven globally by products such as Philip Morris International's IQOS and the nicotine pouch brand Zyn, with related companies pursuing strategies to steadily raise the revenue share of reduced-risk products.
Demand for battery protection circuits is expanding beyond smartphones into electric vehicles (EVs), energy storage systems (ESS), power tools, and cordless vacuum cleaners across a range of mid-to-large battery applications.
Competitively, cost and quality competition with domestic and overseas battery-protection IC/module makers continues, and recently, organizational reinforcement in response to tightened customer quality standards was cited as a cost burden.
The core manufacturing base consists of Vietnam (five factories) and a newly established Indonesian subsidiary, and the recent embezzlement case at the Vietnam subsidiary can also be read as illustrating internal-control risks at overseas production bases.
The company has set a goal of filling the Apple-related revenue gap through Samsung-facing protection circuits and the e-cigarette business, targeting more than double year-over-year growth in protection-circuit revenue and over 50% growth in e-cigarette revenue.
Hana Securities, in a March 2026 report, projected annual revenue of KRW 412.9bn and operating profit of KRW 10.4bn, citing reduced depreciation expense and suggesting a possible turnaround.
The company stated it plans to complete workforce and organizational adjustments related to the Apple business in the second half, aiming to resolve residual costs and focus on improving profitability in its core businesses.
Over the medium to long term, it is sequentially building humanoid-robot battery pack and motor-controller development lines at headquarters, and has outlined plans to expand into battery management systems (BMS), defense battery packs, and marine energy storage systems (ESS).
However, these new businesses remain at an early stage, and the timing of any meaningful revenue contribution has not been confirmed.
Meanwhile, continued support for the Vietnam subsidiary—including a capital injection of roughly KRW 49.8bn in March and debt guarantees of about KRW 68.9bn as of August 5—means the company must pursue its profitability target alongside balance-sheet repair simultaneously.
Management has set a goal of achieving a turnaround in the second half, but the sharp revenue decline and widened losses seen in the second quarter can be read as an indicator of how difficult that goal may be to achieve.
The stock trades at a level that reflects a premium over net asset value, which can be interpreted as partly pricing in market expectations of a turnaround to profitability in 2026 after several years of losses.
However, given the sharp revenue decline and renewed widening of net losses in the second quarter, how this premium aligns with the actual pace of earnings improvement will need to be confirmed through upcoming quarterly results.
Dividends have not been paid in recent years amid continued net losses, suggesting market attention is focused less on dividend appeal and more on the execution of the business restructuring and improvement in the balance sheet.
With the debt ratio having exceeded 400%, any valuation assessment should weigh liquidity and capital-structure risks alongside the pace of profitability recovery.
PER, EPS, PBR and BPS are all calculated in-house (the same method as Naver and Toss) · Dividend yield = cash dividend per share from DART filings (supplemented by KRX) ÷ current price · As of 2026-08-23
Both the company and Hana Securities noted that proactively recognizing large impairments on idle facilities in 2025 should reduce depreciation burden from 2026 onward. This is a structural factor that could improve operating margins if revenue is sustained at a certain level.
Indeed, the company briefly posted operating and net profit in Q3 2025, suggesting the potential for cost-structure normalization.
Samsung-facing protection circuits and the e-cigarette business grew 31.9% and 24.8%, respectively, in the first half, partly offsetting the Apple gap.
The Apple revenue share had already fallen from 77% in 2022 to 57% in 2025 before being fully eliminated, which can be viewed as a structural resolution of customer-concentration risk. Continued growth in these two core businesses could translate into a qualitative improvement in the revenue base.
The company is building humanoid-robot battery pack and motor-controller development lines at headquarters and has outlined plans to expand into BMS, defense battery packs, and marine ESS.
This represents diversification into adjacent markets that can leverage its existing battery protection circuit and pack design technology. However, these are early-stage initiatives, and the timing of actual revenue contribution has not been confirmed.
Immediately after the Apple contract ended, Q2 2026 revenue plunged to KRW 3.4bn from KRW 132.2bn in the prior quarter.
This diverges from the company's separately reported continuing-operations first-half revenue of KRW 135.7bn, leaving uncertainty about whether this reflects a change in revenue recognition or a temporary gap that needs confirmation in the next filing. How quickly Samsung and e-cigarette businesses can fill the gap remains the key question.
The debt ratio rose sharply to 417.9% in 2025 from 206.2% a year earlier, and the company is reported to have exhausted most of its available bank credit lines.
Amid rising perpetual bond rates, financing methods have repeatedly shifted, including short-term borrowing followed by a convertible bond, reflecting ongoing liquidity pressure.
With operating losses persisting and financial costs exceeding them, both operational improvement and balance-sheet stabilization are needed simultaneously.
At the Vietnam subsidiary, local staff misappropriated a total of USD 9.28 million, of which about USD 6.81 million was deemed unrecoverable and written off entirely.
Even after this, headquarters has continued capital injections and debt guarantees to the subsidiary, meaning the financial-support burden for a loss-making subsidiary continues to weigh on parent-company liquidity. This illustrates the need for strengthened internal controls at overseas production bases.
With the debt ratio at 417.9%, issues related to funding—such as exhausted bank credit lines, rising perpetual-bond rates, and convertible-bond issuance—have arisen in succession. As operating losses persist and financial costs exceed them, the need for additional external funding could grow. Any change in capital-market access or credit standing could affect the timeline of the business restructuring.
With the Apple business—once more than half of revenue—now discontinued, the key variable is how quickly and stably Samsung and e-cigarette businesses can replace it. As seen in the sharp Q2 2026 revenue decline, the customer-transition process could produce larger-than-expected revenue gaps or temporary costs. If new customer acquisition or volume expansion falls short of plan, the turnaround target could be delayed.
The embezzlement incident at the Vietnam subsidiary exposed weaknesses in internal controls over overseas subsidiaries. Continued capital injections and debt guarantees to that subsidiary mean the possibility of further loss recognition or support burden cannot be ruled out.
The effectiveness of strengthened internal-control measures and any subsequent loss recognition warrant ongoing monitoring.
At the Q3 report disclosure, it will be important to confirm whether the Q2 revenue plunge was one-off or reflects a change in consolidation scope or discontinued-operations classification.
Quarterly results should be checked to see whether Samsung-facing protection-circuit and e-cigarette revenue are growing at the pace the company targeted (over 2x and over 50% growth, respectively).
Continued monitoring via disclosures is needed on any further capital injections or debt guarantees to the Vietnam subsidiary, as well as the status of bank credit-line utilization.
Progress on the humanoid battery pack and motor-controller development lines, and any initial orders, could serve as the first indicator of whether the new business is materializing.
ITM Semiconductor discontinued its Apple business in April 2026, moving away from a low-margin structure and initiating a profitability-focused pivot centered on Samsung Electronics and e-cigarette products.
Samsung-facing protection circuits and the e-cigarette business posted double-digit growth in the first half, partly filling the gap, but Q2 revenue plunging to KRW 3.4bn and net losses widening again to KRW 65.9bn illustrate the growing pains of this transition.
Concerns over financial stability have also grown as the 2025 debt ratio rose to 417.9% and the Vietnam-subsidiary embezzlement case combined with ongoing capital support burdens.
Some brokerages, including Hana Securities, have suggested a possible 2026 turnaround based on reduced depreciation and restructuring effects, but this is a point-in-time forecast that requires confirmation through future quarterly results.
On balance, the direction of the business restructuring and new-business diversification efforts are positive factors, but the pace of revenue recovery and improvement in the balance sheet both need to be confirmed simultaneously.
Before making any investment decision, it will be important to continue monitoring disclosed earnings and liquidity indicators in the coming quarters.
Report written 2026-09-05 · Data as of 2026-09-04
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