Daqo New Energy more than tripled its polysilicon sales volume sequentially in the second quarter of 2026, but the increase came as pricing fell below the company’s cash production cost.
Polysilicon sales volume increased to 15,190 metric tons from just 4,482 metric tons in the first quarter, meaning Daqo sold roughly 3.4 times as much product sequentially.
Revenue consequently more than doubled sequentially to $62.7 million from $26.7 million. However, revenue remained below the $75.2 million generated in the second quarter of 2025.
The more concerning figure was pricing.
Daqo’s average polysilicon selling price fell to $4.04 per kilogram from $5.96 in the first quarter. Average cash cost was $4.57 per kilogram, while total production cost was $5.95 per kilogram.
That means Daqo’s average selling price was below even its cash cost during the quarter, highlighting the severity of the pricing pressure facing the Chinese polysilicon industry.
Daqo had initially limited below-cost sales as it waited for progress on Chinese industry self-regulation and government policies intended to reduce destructive overcapacity. After an extended period without clear policy changes, the company shifted toward a more market-oriented pricing and sales strategy in June.
The strategy immediately increased shipments but did not restore profitability.
Daqo recorded a gross loss of $82.7 million, although that improved from a $139.4 million gross loss in the first quarter. Gross margin improved to negative 132% from negative 521.5%.
Inventory impairment provisions also declined to $55.7 million from $98.9 million sequentially, contributing to the improvement in gross loss.
Net loss attributable to shareholders was $81.2 million, compared with $88.4 million in the first quarter and $76.5 million a year earlier.
Daqo continues to produce well above its quarterly sales volume, with production totaling 43,675 metric tons during the period. The company expects third-quarter production of approximately 40,000 to 45,000 metric tons and full-year production of 160,000 to 180,000 metric tons.
KEY QUOTE:
“We adjusted our sales and pricing strategies toward a more market-oriented approach in June.”
Xiang Xu, CEO of Daqo New Energy
