On Friday, Morgan Advanced Materials, a semiconductor parts supplier, forecasted a decline in organic revenue for the year due to uncertain demand, partly attributed to U.S. President Donald Trump's policies. The company, with manufacturing facilities in the U.S. and countries affected by Trump's tariffs like Mexico, Canada, and China, expressed readiness to explore other locations to mitigate tariff impacts.
Global companies, including Morgan Advanced Materials, are strategizing to navigate potential tariff implications following Trump's threats to increase tariffs on a variety of imports, including semiconductors.
Morgan Advanced Materials has noted a slowdown in growth for its silicon carbide (SiC) power semiconductor products, primarily due to decreased demand for electric vehicles (EVs). In the U.S., the company's primary market, the EV industry is facing challenges such as consumer preference for cost-effective gas-powered cars and potential policy changes that could eliminate tax credits for EV buyers under the Trump administration.
Despite a 1.3% revenue decline to 1.1 billion pounds ($1.38 billion) in 2024, Morgan Advanced Materials expects organic revenue to decrease in the mid-single-digit percentage range this year. The company achieved a 6.7% increase in adjusted operating profit last year through strategic measures like consolidating manufacturing plants and streamlining reporting segments.
Following this announcement, the company's shares dropped by 8% in early trading, reaching 236p, the lowest level since November 2023. ($1 = 0.7950 pounds)