RetailBook Offer

· The Issue Price represents a discount of approximately 10.1% to the 12 month VWAP ending on 24 April 2026, being the latest practicable date prior to the publication of this announcement, and a discount of approximately 58.4% to the closing mid-market price of 47.6 pence per Ordinary Share on 24 April 2026, being the latest practicable date prior to the publication of this announcement. Existing UK retail shareholders of the Company can apply to take part through RetailBook's partner network of retail brokers, wealth managers and investment platforms, (subject to such partners' participation);

• The RetailBook Offer is available to existing shareholders located in the UK only;
• There is a minimum subscription of £250 per investor in the RetailBook Offer;
• No commission will be charged by RetailBook on applications to the RetailBook Offer.

The RetailBook Offer

IQE (AIM: IQE "IQE", the "Company" and, together with its subsidiary companies, the "Group"), a leading global supplier of compound semiconductor wafer products and advanced material solutions, is pleased to announce a conditional retail offer of new ordinary shares of 1 penny each in the capital of the Company ("Ordinary Shares") via RetailBook (the "RetailBook Offer") at an issue price of 19.8 pence per new Ordinary Share (the "Issue Price"). The Issue Price represents a discount of approximately 10.1% to the 12 month VWAP ending on 24 April 2026, being the latest practicable date prior to the publication of this announcement, and a discount of approximately 58.4% per cent. to the closing mid-market price of 47.6 pence per Ordinary Share on 24 April 2026, being the latest practicable date prior to the publication of this announcement. The Company has also earlier today announced a placing of new Ordinary Shares to institutional investors by way of an accelerated bookbuilding process (the "Placing"), alongside other fundraising elements (the "Fundraising"). For the avoidance of doubt, the RetailBook Offer is not part of the Placing.

The RetailBook Offer is conditional, inter alia, on completion of the Placing, on the passing of resolutions by shareholders of the Company in connection with the Fundraising at a general meeting of IQE to be held at the offices of White & Case LLP at 5 Old Broad Street, London EC2N 1DW at 9:30 a.m. on 15 May 2026 and on the new Ordinary Shares to be issued pursuant to the RetailBook Offer and the Placing being admitted to trading on AIM ("Admission"). Admission is expected to take become effective at or around 8:00 a.m. three Business Days after completion of the Fundraising.

The RetailBook Offer will not be completed without the Placing also being completed.

The Company will use the net proceeds of the Fundraising to repay existing bank debt, redeem certain existing loan notes and strengthen the balance sheet, ensuring the Group has a strong capital position from which to fund operations and investments in its core technology.

Reasons for the RetailBook Offer

The Company values its retail shareholder base and believes that it is appropriate to provide its existing retail shareholders in the United Kingdom with the opportunity to participate in the RetailBook Offer.

The RetailBook Offer is open to eligible retail shareholders of the Company resident and physically located in the United Kingdom following release of this announcement. The RetailBook Offer is expected to close at 8 p.m. on 27 April 2026 and may close earlier at the discretion of the Company or if it is oversubscribed.

Eligibility for the RetailBook Offer

The RetailBook Offer is available to existing shareholders of the Company only. To be eligible to participate in the RetailBook Offer, applicants must be a customer of a participating partner and, as at the date hereof, must be a shareholder in the Company.

Some partners may only accept applications from existing shareholders and/or existing customers.

There is a minimum subscription of £250 per investor. The terms and conditions on which investors subscribe will be provided by the relevant financial intermediaries including relevant commission or fee charges. Note, no commission will be charged to investors by RetailBook in connection with the RetailBook Offer.