{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "MX",
  "name": "Magnachip Semiconductor Corp.",
  "url": "https://frontierpicks.com/dossiers/MX/",
  "json_url": "https://frontierpicks.com/dossiers/MX.json",
  "status": "DORMANT",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a4",
    "n": 4
  },
  "current_thesis": "Magnachip Semiconductor's shares are more likely to lag the S&P 500 over three months: fourth-quarter gross margin is guided to 10%–12% from 14.0%, and the fourth-quarter report, expected around February 2027, shows whether that is the low.",
  "invalidation_trigger": "A daily close above $3.64, the 200-day average of closes as of 2026-11-12, which would show the shares leading the S&P 500. A fourth-quarter gross margin above the 12% top of the guide would also show the shares leading.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "semiconductors-analog"
  ],
  "tags": [],
  "sources": [],
  "caveats": [],
  "source_links": [
    {
      "title": "MAGNACHIP SEMICONDUCTOR Corp - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0001325702/000119312526447409/mx-ex99_1.htm",
      "date": "2026-11-04"
    },
    {
      "title": "Finviz",
      "url": "https://finviz.com/news/416404/magnachips-loss-deepens-as-won-driven-margin-miss-overshadows-a-louder-transformation-pitch",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter 2026 continuing-operations revenue was $43.978 million, inside the $41.5–45.5 million guided range and down 4.3% from a year earlier.",
      "source": "Third-quarter 2026 Form 8-K, Exhibit 99.1",
      "as_of": "2026-11-04"
    },
    {
      "claim": "Third-quarter gross margin was 14.0%, below the 17%–19% guidance, which the company attributed mainly to unfavorable foreign exchange movements.",
      "source": "Third-quarter 2026 Form 8-K, Exhibit 99.1",
      "as_of": "2026-11-04"
    },
    {
      "claim": "Net loss from continuing operations was $13.3 million, or $(0.36) per share; adjusted EBITDA from continuing operations was $(3.5) million.",
      "source": "Third-quarter 2026 Form 8-K, Exhibit 99.1",
      "as_of": "2026-11-04"
    },
    {
      "claim": "Fourth-quarter 2026 guidance is revenue of $41.0–45.0 million and gross margin of 10%–12%, citing a power shutdown for a substation upgrade and a stronger Korean won.",
      "source": "Third-quarter 2026 Form 8-K, Exhibit 99.1",
      "as_of": "2026-11-04"
    },
    {
      "claim": "Cash was $86.9 million at the end of the third quarter.",
      "source": "Third-quarter 2026 Form 8-K, Exhibit 99.1",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Director Cristiano Amoruso bought 568,009 shares at an average of $2.41 on 2026-11-06 to 2026-11-09 and sold 378,252 shares at $2.22 on 2026-11-06.",
      "source": "SEC Form 4 filed 2026-11-10",
      "as_of": "2026-11-10"
    },
    {
      "claim": "Chief Executive Officer Chae Lee bought 70,000 shares at an average of $2.22 on 2026-11-06.",
      "source": "SEC Form 4 filed 2026-11-10",
      "as_of": "2026-11-10"
    },
    {
      "claim": "Adjusted loss per share of $(0.29) missed the $(0.20) estimate, and sales of $43.978 million missed the $47.5 million estimate.",
      "source": "Benzinga earnings summary",
      "as_of": "2026-11-04"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Technology",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-05",
              "restated": null,
              "value_musd": 44,
              "yoy_pct": -4.3
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-10",
              "restated": null,
              "value_musd": 44.7,
              "yoy_pct": -6.1
            },
            {
              "end": "2026-03-31",
              "filed": "2026-05-08",
              "restated": null,
              "value_musd": 46.2,
              "yoy_pct": 3.3
            },
            {
              "end": "2025-12-31",
              "filed": "2026-03-16",
              "restated": null,
              "value_musd": 40.6,
              "yoy_pct": -20.7
            },
            {
              "end": "2025-09-30",
              "filed": "2025-11-10",
              "restated": null,
              "value_musd": 45.9,
              "yoy_pct": -17.1
            },
            {
              "end": "2025-06-30",
              "filed": "2025-08-05",
              "restated": null,
              "value_musd": 47.6,
              "yoy_pct": 2.6
            }
          ]
        },
        "gross_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-05",
              "restated": null,
              "pct": 14
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-10",
              "restated": null,
              "pct": 19.3
            },
            {
              "end": "2026-03-31",
              "filed": "2026-05-08",
              "restated": null,
              "pct": 15.6
            },
            {
              "end": "2025-12-31",
              "filed": "2026-03-16",
              "restated": null,
              "pct": 9.3
            },
            {
              "end": "2025-09-30",
              "filed": "2025-11-10",
              "restated": null,
              "pct": 18.6
            },
            {
              "end": "2025-06-30",
              "filed": "2025-08-05",
              "restated": null,
              "pct": 20.4
            }
          ]
        },
        "operating_margin": {
          "status": "ok",
          "quarters": [
            {
              "end": "2026-09-30",
              "filed": "2026-11-05",
              "restated": null,
              "pct": -29.3
            },
            {
              "end": "2026-06-30",
              "filed": "2026-08-10",
              "restated": null,
              "pct": -22.3
            },
            {
              "end": "2026-03-31",
              "filed": "2026-05-08",
              "restated": null,
              "pct": -15.5
            },
            {
              "end": "2025-12-31",
              "filed": "2026-03-16",
              "restated": null,
              "pct": -30.7
            },
            {
              "end": "2025-09-30",
              "filed": "2025-11-10",
              "restated": null,
              "pct": -25.1
            },
            {
              "end": "2025-06-30",
              "filed": "2025-08-05",
              "restated": "2026-08-10",
              "pct": -13.9
            }
          ]
        },
        "pretax_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": -8.4
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "four_quarters_end": "2026-09-30",
          "value_musd": -12.5,
          "four_quarters_musd": -30.1
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": -15.7
        },
        "capital_spending": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": 17.8
        },
        "free_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "first_end": "2025-12-31",
          "value_musd": -33.5
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "base_end": "2025-09-30",
          "pct": 2
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 86.9
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 47.1,
          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 39.8
        },
        "deferred_revenue": {
          "status": "not reported"
        },
        "backlog": {
          "status": "not reported"
        },
        "receivables": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 24.9
        },
        "inventory": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 40.4
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-05",
          "value_musd": 245.4
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-31",
          "basis_filed": "2026-11-05",
          "value_musd": 95.1
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-31",
          "basis_filed": "2026-11-05",
          "value_musd": 55.3
        },
        "ev_sales": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-31",
          "basis_filed": "2026-11-05",
          "multiple": 0.3
        },
        "ev_ebit": {
          "status": "not meaningful"
        },
        "pe": {
          "status": "not meaningful"
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-31",
          "basis_filed": "2026-11-05",
          "multiple": 0.4
        },
        "fcf_yield": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-10-31",
          "basis_filed": "2026-11-05",
          "pct": -35.3
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-10-26",
      "short_pct_of_outstanding": 2.87,
      "days_to_cover": 1.2,
      "change_pct": -34.7
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-15",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-18",
          "bought_usd": 1845106.03,
          "sold_usd": 840665.07,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-16",
          "bought_usd": 2013265.55,
          "sold_usd": 840665.07,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\nMagnachip Semiconductor's shares are more likely to lag the S&P 500 over the next three months. The company guided fourth-quarter gross margin to 10%–12%, down from 14.0% in the third quarter, and the fourth-quarter report, expected around February 2027, shows whether that is the low point.\n\nThe third-quarter report of 2026-11-04 met the revenue guide and missed on margin. Revenue from continuing operations was $43.978 million, inside the $41.5–45.5 million guided range and 4.3% below a year earlier. Gross margin was 14.0% against guidance of 17%–19%, which the company attributed mainly to unfavorable foreign exchange movements (Form 8-K, Exhibit 99.1). The net loss from continuing operations was $13.3 million, or $(0.36) per share.\n\nInsiders bought after the report. Director Cristiano Amoruso reported open-market purchases of 568,009 shares at an average of $2.41 on 2026-11-06 to 2026-11-09, and a sale of 378,252 shares at $2.22 on 2026-11-06. CEO Chae Lee bought 70,000 shares at an average of $2.22 on 2026-11-06 (SEC Form 4 filings, 2026-11-10).\n\nThe market has already marked the shares down hard: they closed at $2.82 on 2026-11-12, 71.4% below the 52-week intraday high of $9.86 on 2026-06-03, and below the $3.42 Navitas Semiconductor paid for its shares on 2026-09-21.\n\n## Bull Case\n- **Insiders bought at the lows.** Amoruso's purchases and CEO Lee's 70,000-share purchase were reported on Form 4 filings dated 2026-11-10, within days of the 2026-11-05 closing low of $2.05. Lee also bought 100,000 shares at an average of $3.18 on 2026-09-23 to 2026-09-24.\n- **Revenue held inside guidance.** Third-quarter continuing-operations revenue of $43.978 million landed within the range given on 2026-07-29. Fourth-quarter revenue is guided to $41.0–45.0 million, a similar range.\n- **Management frames the fourth quarter as the margin low.** The 10%–12% guide reflects a power shutdown for a substation upgrade and a stronger Korean won (Form 8-K, 2026-11-04). Earnings Whispers reported on 2026-11-04 that management called the quarter the trough and is considering selective price increases. Price increases are not in the 8-K.\n- **Cash covers the losses for now.** Magnachip held $86.9 million of cash at 2026-09-30 (Form 8-K). On 2026-09-21 Navitas bought 1,461,988 shares at $3.42 ($5 million) and Magnachip licensed GeneSiC silicon-carbide technology (Business Wire).\n\n## Bear Case\n- **Margins are falling.** Gross margin was 14.0% in the third quarter after 19.3% in the second, and the fourth quarter is guided to 10%–12%. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) from continuing operations was $(3.5) million in the third quarter.\n- **Results missed analyst estimates.** Benzinga reported on 2026-11-04 that adjusted loss per share of $(0.29) missed the $(0.20) estimate, and sales of $43.978 million missed the $47.5 million estimate.\n- **Revenue is shrinking.** Third-quarter continuing-operations revenue was down 4.3% from a year earlier, and the fourth-quarter guide of $41.0–45.0 million brackets that level.\n- **Partner shares can reach the market.** A Form S-3 resale registration filed 2026-10-05 covers the 1.46 million shares Navitas bought at $3.42. The shares closed at $2.82 on 2026-11-12, below that price.\n- **A director also sold.** Amoruso's Form 4 filed 2026-11-10 shows a sale of 378,252 shares at $2.22 on 2026-11-06, alongside his purchases.\n\n## Setup & Price Structure\nThe shares closed at $2.82 on 2026-11-12, after $2.96 on 2026-11-11, $2.53 on 2026-11-10, $2.50 on 2026-11-09, $2.36 on 2026-11-06 and a 52-week closing low of $2.05 on 2026-11-05. The 52-week intraday high is $9.86, set on 2026-06-03.\n\nThe 3-month change is −26.0% (from a $3.81 close on 2026-08-14). The shares sit just under the 50-day average of closes at $2.90 and well below the 200-day average of closes. A close above the 200-day average is the level that would show the shares leading.\n\nThe rebound from the 2026-11-05 low came on insider buying and a short-covering-style bounce in a thinly covered stock. The 1.46 million resale-registered Navitas shares are the one identifiable block of potential selling. The company's market value was about $116 million when the shares traded near $3.82 on 2026-09-25 (Benzinga), so a small share count makes each block meaningful.\n\n## Catalyst Calendar\n\n- **~2027-02 (est.):** Fourth-quarter 2026 results and first-quarter 2027 guidance (date not yet announced). Tests the 10%–12% gross-margin guide and the $41.0–45.0 million revenue range, and whether price increases and the Navitas silicon-carbide license show up in the numbers.\n\n## What Would Change Our Mind\n\nA daily close above $3.64, the 200-day average of closes as of 2026-11-12, which would show the shares leading the S&P 500. A fourth-quarter gross margin above the 12% top of the guide would also show the shares leading.\n\n## Correlation Notes\nMagnachip sells power and display semiconductors into consumer electronics, so demand tracks television, notebook and PC volumes more than artificial-intelligence spending. Navitas Semiconductor is the direct comparison for silicon-carbide power chips. The Korean won matters for costs: management blamed won strength for the third-quarter margin miss and for the fourth-quarter guide. Peer price increases in power chips, cited by management on the call, are a read-across for Magnachip's pricing.",
  "first_seen": "2026-11-10",
  "last_analyzed": "2026-11-13T00:43:09+00:00",
  "last_synthesized": "2026-11-13",
  "date_modified": "2026-11-13",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}