Cohu saw a sharp pre-market rally of +26.3%, with shares reaching $58.68 after the firm released second-quarter 2026 results that exceeded Wall Street forecasts on both the top and bottom lines. The company reported non-GAAP earnings per share of $0.26 versus an analyst consensus of $0.14, and revenue of $149 million compared with estimates of $144 million. Revenue was up 38% from the comparable quarter a year earlier.
Management provided a more optimistic full-year outlook for its high-performance computing (HPC) business, raising the 2026 HPC revenue range to $100 million - $110 million from a prior $80 million - $100 million target. For the third quarter, the company guided revenue to approximately $170 million, representing about 35% year-over-year growth.
Key operational metrics highlighted by the company included an expanded HPC pipeline of roughly $850 million on an annualized basis and test cell utilization at 80%. Management said recurring revenue accounted for 53% of total sales, a figure supported by higher utilization and an expanding pipeline. The company also pointed to wins for its Eclipse platform with leading chip manufacturers for AI processor testing as evidence of its role in enabling HPC test capacity.
Analyst reaction included a price target lift from Needham, which increased its target on the stock to $65 from $54 while maintaining a Buy rating, citing the strong quarterly performance and the improved outlook for HPC demand.
The broader market provided a constructive backdrop to the rally. On the session, the NASDAQ gained 1.3%, the S&P 500 rose 0.5%, and the Dow Jones advanced 0.7%, reflecting ongoing investor appetite for technology and AI-adjacent names. Cohu's results arrived amid continued focus on semiconductor equipment spending tied to artificial intelligence infrastructure, a theme cited by management in explaining the company's positioning.
Taken together, the combination of a decisive earnings beat, materially upgraded HPC guidance, a bullish analyst price-target revision, and supportive market conditions created the environment for the pronounced pre-market move. Investors appeared to reprice Cohu's growth trajectory heading into the second half of 2026 based on the new financial targets and pipeline commentary.