SCHMID lifts 2026 order goal past €150 million as quarterly sales slip

SCHMID Group is headquartered in Freudenstadt, Germany, was founded in 1864 and employs more than 800 people.¹ It runs technology centers and factories in Germany and China, and its products serve advanced chip packaging, printed circuit boards, substrates and glass-based technologies.² Recent orders were for production lines that make high-density multilayer boards and fine-line boards, the second by a method called modified semi-additive processing.³ The company says heavy spending on artificial intelligence is a main driver of its market, and that large Chinese players often dominate equipment making.⁴

The business is small and concentrated. Revenue for 2025 was €66.9 million, and the ten largest customers made up about 60% of it.¹ More than half of first-half 2026 revenue came from China. In 2025 weak Chinese demand left revenue below forecast and caused liquidity problems.² The company also filed its 2024 annual report late, drew Nasdaq delinquency and delisting notices in May and November 2025, and remains under Nasdaq monitoring until February 19, 2027.³

Revenue was €18.2 million in the first quarter of 2026 and €27.7 million in the second.¹ The first-half net loss was €47.8 million, but most of it sat below the operating line. The operating loss was €8.0 million, and the financial result was a €38.8 million charge, driven mainly by the accounting for debt owed to XJ Harbour that turned into shares in January.² Adjusted EBITDA, which the company defines as net income before taxes, net finance result, depreciation, amortization and special items, was a loss of €0.6 million.³ In August the company cut its 2026 Adjusted EBITDA margin goal to 6 to 9% from more than 12%, citing weaker than expected first-half results.⁴

Operations used €29.3 million of cash in the first half, mainly €26.1 million tied up in working capital.¹ Cash was €2.3 million at June 30 and about €14.3 million at July 31, after $20.0 million of convertible notes due 2029 closed on July 14.² Equity was a negative €30.8 million at June 30, meaning the books showed more liabilities than assets.³

Its October 1 prospectus kept the 2026 order goal at €125-150 million, in the upper half of that range, and said the order book is expected to be realized within 12 months.¹ On September 30 the SEC declared effective updated resale registrations for up to 89,341,198 shares and 9,750,000 private warrants, 4,958,481 Schmid family set-off shares, up to 5,000,000 Yorkville equity-line shares and up to 10,362,693 shares from conversion of the 2029 notes; the stock fell 43% by October 16, from $4.88 to $2.785.²

Third-quarter orders were €67.8 million, and the order book reached €96.8 million at September 30.¹ Most of that was already public: on August 25 the company reported €52.3 million of third-quarter orders through August 21 and an order book of €95.0 million, so the rest of the quarter after August 21 added about €15.5 million of orders and €1.8 million of order book.² The quarter's orders included the repeat order of more than €37 million announced on July 7, which came from a leading Chinese customer for its next expansion of fine-line board production.³ So a single customer supplied more than half the quarter's orders. Nine-month orders reached €111.7 million, and the new full-year 2026 goal is more than €150 million.⁴ Hitting it takes more than €38.3 million of orders in the fourth quarter.⁵

On October 21 SCHMID also said it reached agreement on an equipment order worth more than €25 million with one of its key customers and long-standing technology partners. The order supports expansion of high-density interconnect board capacity in Malaysia, and the release describes that expansion as planned.¹ More than €7 million of it was already in third-quarter orders, with the rest booked in the fourth quarter. If the order is close to €25 million, about €18 million lands in fourth-quarter orders, roughly half of what the new goal needs.²

Revenue is the weak side. Third-quarter revenue of €24.0 million was 13% below the second quarter's €27.7 million.¹ Nine-month revenue was €70.0 million, against a full-year 2026 goal of more than €100 million. Clearing it takes more than €30 million in the fourth quarter.² That is 25% more than the third quarter, and above the first quarter's €18.2 million and the second quarter's €27.7 million.³

The order book is the main support for that goal. At €96.8 million it is 3.2 times the fourth-quarter need, and third-quarter orders were 2.8 times third-quarter revenue.¹ The company expects to realize the order book within 12 months, a window that runs well past December. The book counts equipment only, not services or spare parts.²

A 6 to 9% margin on more than €100 million of full-year revenue means at least €6 million of Adjusted EBITDA for 2026. After the first half's €0.6 million loss, the second half needs at least about €6.6 million.¹ In August the company said it expected second-half revenue to split roughly evenly between its two plants, and it put annual savings from its Sprint cost program at €4 million. On October 21 it said those savings are progressing as planned.² It gives no reconciliation of its margin goal to reported profit.³

Adjusted figures flatter reported ones. In the first half the company added back €1.4 million of share-based pay, €1.4 million of recapitalization costs and €1.7 million of currency losses.¹ The third-quarter figures are preliminary and unaudited, and actual results may differ.²

Cash was about €14.3 million at July 31. About $21 million also remained on the Yorkville equity line, under which SCHMID can sell new shares at 97% to 99% of recent trading prices.¹ The company says it has enough money for at least the next 12 months. It does not expect material further share sales under the line in 2026 and does not plan new debt at the parent or its German operating company.² Debt outside the convertibles was €23.4 million at June 30, with €17.5 million owed to shareholders and related parties and €5.9 million to banks and other third parties.³ Family-linked lenders agreed in July that their loan principal can be repaid only after operating free cash flow tops €15 million over the prior 12 months, though interest can still be paid until a default and up to €800,000 can be paid on one partly exempted loan regardless.⁴

An insider-backed €2.5 million convertible loan with 15% interest comes due on March 16, 2027, and it converts at a fixed $2.15 a share, below the current price.¹ A standard debt-to-earnings ratio is not meaningful, because first-half Adjusted EBITDA was negative. Interest on the 2028 notes is 7% a year and paid in kind, meaning it is added to the notes instead of paid in cash, and the 2029 notes pay 5% the same way.² One trigger matters for next spring. The 2029 notes' terms make it a default if an annual report states substantial doubt about the company's ability to continue as a going concern, and in its 2025 accounts management found no such material uncertainty.³ A $2.35 million promissory note claim from Validus is in dispute and is carved out of those default terms.⁴

There were 62,805,666 shares outstanding on October 21, not counting 5,000,000 unvested earn-out shares. Those are forfeited on April 30, 2027 unless the stock reaches $15 or $18.¹ In September holders converted $4 million of the 7.00% notes due 2028, plus interest, into 1,167,712 shares, and $5 million remains. Those notes convert by a formula based on 95% of the average trading price.² The $20.0 million of 2029 notes can convert only after the 2028 notes are gone, at the lower of $10.50 or 97% of the average price, with a $1.93 floor. The company registered up to 10,362,693 shares for them, equal to 16.5% of today's count.³ Counting every instrument, including 21 million warrants at $11.50 that sit far above the share price, up to 64,414,896 more shares could be issued.⁴ A limit on new borrowing under the convertible notes stays in place until the 2028 notes fall to $5 million or less and the 2029 notes to $9 million or less, so with $20.0 million of 2029 notes outstanding it still applies even though only $5 million of 2028 notes remain.⁵ Anette and Christian Schmid together held 30,926,893 shares, 50.18% of the total, according to the October 1 prospectus; after the September conversions that is about 49% of the 62,805,666 shares outstanding, so the family still holds roughly half the vote.⁶

At the $3.02 close on October 20, the shares outstanding were worth about $190 million, set against 2026 revenue the company expects to top €100 million.¹ The stock traded at $4.91 on August 21. Insiders later bought near today's price: director Anette Schmid bought 69,000 shares at $3.1623, and director Ralf Speth bought 35,000 at $3.248 and 33,000 at $3.05.² The company's May 2026 annual report said it had no analyst coverage.³

The bull case: orders more than doubled, the order book rose €42 million in a single quarter even though only €1.8 million of that came after August 21, and a new Malaysian order adds to fourth-quarter bookings. If the €96.8 million book ships on schedule, more than €30 million of fourth-quarter revenue is well covered.¹ Cost savings and a more even plant mix could then lift the second-half margin, and insiders bought shares near today's price.²

The bear case, strongest point first. Revenue fell while orders rose, so the company must post its best quarter of the year at year end, after already cutting its margin goal once.¹ Bookings lean on a few buyers: one Chinese order was more than half the quarter's orders, and the ten largest customers made up about 60% of 2025 revenue.² Convertible notes keep turning into shares below the market price, with the 2029 notes next in line, and equity was still negative at June 30.³

What would prove the bull case wrong is full-year 2026 revenue under €100 million or a margin under 6%. The full answer arrives with the 2026 annual report, due by April 30, 2027.¹ Other dated tests come first: Nasdaq monitoring ends February 19, 2027, the insider-backed loan matures March 16, 2027, and the earn-out shares are forfeited on April 30, 2027 if the price targets are missed.² Our call is that SHMD, at $3.125 today, will not close above $5 on the first trading day after that deadline, because even if the revenue goal is met, notes that convert at 95% to 97% of the trading price can keep weighing on the stock.³

The preliminary release gives orders, revenue and the order book, but it prints no third-quarter profit, margin, cash or debt figure, and it says it cannot reconcile its margin goal to reported profit without unreasonable effort.

The Malaysian order release names the buyer only as one of the company's key customers and long-standing technology partners. It gives no delivery dates, price terms or margins, so it is unclear whether any of the order reaches 2026 revenue.

The company expects to realize the order book within 12 months, but it does not say how much of the €96.8 million falls in the fourth quarter.

No filing explains why the stock fell 43% from $4.88 on September 30 to $2.785 on October 16. The September 30 close itself came after a run up from $3.21 on September 15, and the drop followed September note conversions into 1,167,712 shares.