NationGate surges despite Q2 profit plunging nearly 80%
The tech stock rose as much as 19% to RM1.84 today, its highest level in over a year.
NationGate's Q2 FY2026 net profit plummeted 79% to RM10.9 million from RM52.15 million a year prior. (NationGate image) PETALING JAYA: NationGate shares surged by up to 19% to RM1.84 on Monday, their highest level in over a year, despite the decline. The stock retreated slightly to close 14.1% higher at RM1.70, valuing the firm at RM3.87 billion.
NationGate's shares are the most traded on Bursa Malaysia, with 172.1 million shares changing hands, a four-fold increase from the average of 38.1 million shares over the past four weeks. The company's Q2 net profit fell sharply to RM10.9 million from RM52.15 million, as earnings normalized from a high base a year earlier. Revenue dropped 32% to RM1.77 billion from RM2.6 billion, mainly due to a significant decline in sales from data computing, and less favorable foreign-exchange movements.
NationGate's data computing segment generated around RM1.5 billion, or 85% of total quarterly revenue. Despite the profit plunge, the company met research house expectations for Q2 results. UOB Kay Hian upgraded NationGate to "buy" with a higher target price of RM1.88, citing new optical module programmes, strong AI data centre demand, and improving yields.
Kenanga Research maintained an "outperform" rating with a target price of RM2.14 and kept its earnings forecasts unchanged, noting that the earnings potential from new photonics customers has not been fully priced in yet. NationGate, founded in 2022, is a turnkey solutions provider focusing on electronic component assembly, testing, and Nvidia contract manufacturing.
Co-founder and managing director Ooi Eng Leong and his wife Tan Ah Geok hold a controlling stake in the company.
Written by urgent.news from Free Malaysia Today's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
