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Investing.com -- Morgan Advanced Materials Plc (LON:MGAMM) shares tumbled 8.2% on Tuesday after the company cut its full-year 2025 sales forecast, citing persistent weakness in semiconductor markets and growing uncertainty in European industrial sectors.
The advanced materials manufacturer now expects sales to decline approximately 4% compared to the previous year on an organic constant currency basis. The company also projects its adjusted operating profit margin to fall to around 10% for the year, down significantly from 11.7% in the previous year.
For the first nine months of 2025 ending September 30, Morgan reported sales 3.6% lower than the same period last year on an organic constant currency basis. However, third-quarter revenue showed a modest 1.6% increase YoY, which the company said reflects "signs of stabilisation in a number of our end markets."
The company cited ongoing weakness in semiconductor markets as customers work through excess inventory, resulting in orders being pushed into 2026. This delay, combined with "under-recovered costs from lower sales volumes in the short-term, a weaker mix and some FX impact," contributed to the reduced profit margin outlook.
"Whilst the markets remain challenging the Group continues, as has been our regular practice, to focus on strong cost management and simplification of our business," the company stated in its trading update.
Morgan Advanced Materials, which produces specialized products for sectors including aerospace, healthcare, and industrial applications, has been navigating a difficult macroeconomic environment throughout 2025, with particular pressure in its semiconductor-related business lines.