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源杰科技(688498):电信行业需求复苏 持续开拓数通高端市场

Yuanjie Technology (688498): Telecom industry demand recovery continues to open up the high-end digital communication market

招商證券 ·  Apr 26

Event: On April 25, 2024, the company released the 2023 Annual Report and the 2024 First Quarter Report. In 2023, the company's revenue was 144 million yuan, down 48.96% year on year, and net profit to mother was 0.19 million yuan, down 80.58% year on year. Revenue for the first quarter of 2024 was 60 million yuan, up 72.33% year on year, up 17.28% month on month, and net profit to mother was 11 million yuan, down 11.06% year on year, turning loss into profit from month to month, and performance continued to recover.

The industry is picking up, mass production of new EML products has begun, and performance continues to recover. The company's revenue in 2023 was 144 million yuan, down 48.96% year on year; net profit to mother was 19 million yuan, down 80.58% year on year. Among them, 1) Telecom market business: revenue of 133 million yuan, down 43.83% year on year, mainly affected by downstream customer inventory and slowing operator construction; 2) data center and other business: revenue of 0.5 billion yuan, down 89.47% year on year, mainly affected by the slowdown in traditional cloud data center investment. Revenue for the first quarter of 2024 was 60 million yuan, up 72.33% year on year, up 17.28% month on month; net profit to mother was 0.1 million yuan, down 11.06% year on year, turning loss into profit month on month; net profit after deducting 10 billion yuan, up 109.72% year on year, mainly due to reduced government subsidies. Benefiting from the obvious recovery of the optical chip industry, the company's product line was further enriched, new EML products were mass-produced, and performance continued to improve month-on-month.

Downstream customer inventories and operator construction recovered, and net interest rates recovered month-on-month. In 2023, the company's net profit margin decreased by 21.97 pcts year on year, and gross margin decreased by 20.02 pcts year on year, mainly affected by product structure and competitive prices. Among them, gross margin of telecom market business decreased by 20.64 pct year on year, and gross margin of data center and other businesses increased 9.03 pct year on year. Accumulated asset impairment losses of 0.18 million yuan are mainly due to a decline in demand for some downstream products, competition intensified price declines, and increased losses due to inventory depreciation. Net profit margin for the first quarter of 2024 fell 16.45 pct year on year, up 21.38 pct month on month; gross margin fell 7.92 pct year on year, down 12.18 pct month on month; sales/management/R&D expense ratio decreased 0.49/2.85/1.34 pct month on month.

Continuing to increase investment in R&D, 100G EML and high-power CW chips have been sent for testing. In 2023, the company spent 31 million yuan on R&D, up 14.23% year on year, R&D investment increased 11.85 pct year on year in revenue, and continued to increase investment in high-speed high-power optical chip products. In the field of optical fiber access, 10G DFB products with differentiated solutions have been developed and tested to customers, and 10G EML products have been continuously optimized and upgraded.

Develop and test related ONU and OLT terminal optical chip products for the next generation of 25G/50G PON optical fiber networks. In the data center field, 100G PAM4 EML, 70mW/100mW high-power CW chips have completed product development, design and finalization, and sample testing on the client side. In higher speed application scenarios, the company initially completed performance development and in-factory testing of 200G PAM4 EML, and the product continued to be optimized.

Investment advice: The industry picked up in the first quarter of 2024, and the company's performance continued to recover. Downstream customer inventory and operator construction pace have recovered, and AI data center demand for high-speed optical modules has led to an increase in high-speed optical chip performance.

The company continues to increase investment in R&D and promote sample delivery testing, and 100G EML and silicon CW light sources are expected to form an incremental revenue source. We expect the company to achieve operating income of 272/385/487 million yuan in 2024/25/26, an increase of 88%/42%/26% year on year; net profit to mother of 0.75/1.28/ 175 million yuan, an increase of 285%/70%/37% year on year. Maintain an “overweight” investment rating.

Risk warning: Demand in the field of AI and digital communication falls short of expectations, market competition increases risk, and risk of international trade disputes.

The translation is provided by third-party software.


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