Cohu Stock Soars on Strong Earnings and Upgraded AI-Related Outlook

Shares of Cohu, Inc. (COHU) surged in pre-market trading after the semiconductor test and handling equipment supplier announced second-quarter 2026 financial results that significantly surpassed Wall Street expectations and provided a robust outlook driven by demand for artificial intelligence applications.

Strong Q2 Results and Guidance

Cohu reported strong performance for the second quarter, handily beating analyst consensus on both key metrics. The company's forward-looking guidance also pointed to accelerating growth, signaling confidence in its business trajectory for the second half of the year.

• Non-GAAP EPS: $0.26, nearly double the analyst consensus of $0.14.
• Revenue: $149 million, exceeding estimates of $144 million and representing a 38% increase from the same period a year earlier.
• Q3 Revenue Guidance: The company projects third-quarter revenue of approximately $170 million, which would mark roughly 35% year-over-year growth.

AI Demand Fuels Upgraded Outlook

The company's positive results are closely tied to the expanding needs of the high-performance computing (HPC) and artificial intelligence sectors. Cohu raised its full-year 2026 HPC revenue estimate to a range of $100–$110 million, up from a prior forecast of $80–$100 million.

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Management noted that its HPC pipeline has expanded to approximately $850 million annually. The company also highlighted recent wins for its Eclipse platform with leading chipmakers for AI processor testing. Operational metrics showed increased activity, with test cell utilization climbing to 80% and recurring revenue accounting for 53% of total sales.

Market Reaction

Investors reacted positively to the news, sending Cohu's stock up 26.3% to $58.68 in pre-open trading. The strong report also prompted at least one analyst upgrade, with Needham raising its price target on the stock to $65 from $54 while maintaining its Buy rating.

The rally occurred within a constructive market environment, with major U.S. indices also trading higher, reflecting continued investor interest in technology companies positioned to benefit from the growth of AI infrastructure.