GCT Semiconductor Holding, Inc. — financial distress indicators
Financial-health summary
GCT Semiconductor Holding, Inc.'s reported numbers place it in the 'Very weak' financial-health band (distress score 72/100). The main indicators are liabilities exceed assets (negative equity), cash runway under 12 months and losses in each of the last 3 years.
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Total liabilities are 2.04× total assets.
Balance-sheet insolvency test: debts exceeding the fair value of assets is the statutory definition of 'insolvent' in 11 U.S.C. §101(32).
At the current free-cash-flow burn, cash covers ~11 months.
Going-concern standard: management must assess ability to continue for 12 months (ASC 205-40). Runway below that horizon forces dilution, asset sales or default.
Net income negative in 3 of 3 fiscal years.
Persistent losses erode equity and the capacity to absorb shocks.
Revenue changed -69% year over year.
A >30% sales drop typically breaches leverage covenants and starves fixed-cost coverage.
Operating cash flow negative in 3 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
Operating margin fell from -91% to -1275% in two years.
Sharp margin compression signals loss of pricing power or cost control.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- No material mitigating factors found in the available data.
📰 Recent news scan
- GCT Semiconductor: All Depends On Its Product Ramp (NYSE:GCTS) - Seeking AlphaGoogle News · 2026-10-08
- $GCT Semiconductor Holding (GCTS.US)$[Strong][Grin][Waddle][Leek][Tremble][Heart] - MoomooGoogle News · 2026-10-08
- GCTS Should I Buy - Intellectia AIGoogle News · 2026-10-03
- Director Nelson Chan acquires 12,971 GCT Semiconductor (GCTS) stock units, holds 147,872 shares. - Stock TitanGoogle News · 2026-10-02
- Director Kukjin Chun acquires 12,971 stock units at GCT Semiconductor (GCTS). - Stock TitanGoogle News · 2026-10-02
- GCT Semiconductor (GCTS): The Best Tech Stock with Huge Upside Potential - Yahoo FinanceGoogle News · 2026-06-06
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do GCT Semiconductor Holding, Inc.'s financial-health indicators show?
As of 2026-10-08, GCT Semiconductor Holding, Inc.'s public financial data places it in the 'Very weak' band with a distress score of 72/100, driven by liabilities exceed assets (negative equity), cash runway under 12 months and losses in each of the last 3 years. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is GCT Semiconductor Holding, Inc.'s financial distress score?
72/100 ('Very weak').
What works in GCT Semiconductor Holding, Inc.'s favour?
No material mitigating factors were found in the available data.
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Semiconductor companies with distress indicators
- Wolfspeed, Inc. (WOLF)Very weak 70/100
- Fabric.AI, Inc. (FABC)Weak 65/100
- SmartKem, Inc. (SMTK)Weak 65/100
- Peraso Inc. (PRSO)Weak 63/100
- POET Technologies Inc. (POET)Weak 50/100
- Pixelworks, Inc. (PXLW)Watch 49/100
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.