Nexteq PLC (LSE:NXQ) shares slumped 23% lower in Thursday morning trade, down to 50p, after it warned FY26 revenue will be around 15% below previous market expectations as tariff pressure and higher component costs hit demand in its Quixant gaming technology business.
The AIM-listed technology solutions provider said Quixant, which serves the land-based gaming market, has been affected indirectly by US tariffs and directly by higher costs for DDR4 and DDR5 memory and storage components. Those costs have raised customer prices to end markets, softening demand and order coverage.
Consensus expectations before the update stood at US$85 million of revenue, US$4.8 million of adjusted EBITDA and US$2 million of adjusted profit before tax. Nexteq said the revenue shortfall would have a consequential impact on adjusted profit before tax, though current gross margin percentage performance is expected to continue through FY26.
Densitron, the group’s industrial display and human-machine interface business, has also seen challenges with specific customer demand but remains on track for year-on-year growth, supported by improved margins on new customer wins.
Chief executive Duncan Faithfull said the pressure in gaming had caused a “temporary reduction in expectation”, but added that Nexteq had retained 100% of customers and expects normal volume levels to return through 2027.
The company also pointed to pipeline growth across Quixant and Densitron, recent LaunchPad gaming software wins and potential growth for Quixant in Brazil in 2027.