Juxin Technology predicts 2024H2 revenue of 0.28 billion yuan, YoY +28%; gross margin of about 46.4%, YOY+5.1 pcts. The company's Bluetooth speaker SoC, low-latency, high-quality wireless audio SoC, end-side AI processor, and second-generation smartwatch SoC business lines go hand in hand. Maintain an increase in holdings rating.

Key points to support ratings

Revenue grew steadily year over year, and gross margin rebounded significantly year over year. Juxin Technology predicts 2024H2 revenue of 0.28 billion yuan, YoY +28%; gross profit margin of 46.4%, YoY+5.1 pcts; net profit without return to mother of 0.023 billion yuan, YoY +44%. According to the performance forecast, Juxin Technology's 2024Q2 revenue was 0.162 billion yuan, QoQ +36%, YoY +17%; gross profit margin 47.1%, QoQ +1.7pcts, YoY+5.7pcts; net profit without return to mother 0.018 billion yuan, QoQ +220%, YoY +13%.

Multiple product lines go hand in hand. The company's Bluetooth speaker SoC has been used by leading international brands such as Harman, Sony, and Anke Innovation in 2023, and the share of international top brands continued to increase in the first half of 2024. Hot terminal products such as wireless home theater audio, wireless microphones, and new radio sports headsets are constantly emerging, driving the company's sales revenue of low-latency, high-sound quality wireless audio products to increase exponentially. End-side AI processors also continued to expand, and sales revenue increased significantly year over year. The second-generation smartwatch SoC released by the company in 2023 is equipped with next-generation low-power technology, which is also expected to contribute new growth points.

High-specification products led to a recovery in gross margin. The recovery in global consumer electronics demand, combined with the upgrading of the company's product matrix, and the increase in sales share of high-margin products, led to a significant improvement in the company's overall gross margin.

valuations

Juxin Technology's 2024/2025/2026 EPS is expected to be 0.54/0.62/0.72 yuan respectively.

As of the close of July 15, 2024, the company's total market value was about 3.5 billion yuan, corresponding to 2024/2025/2026 PE 43.8/37.8/32.7 times, respectively. Maintain an increase in holdings rating.

The main risks faced by ratings

Market demand fell short of expectations. Brand penetration falls short of expectations. Product iterations aren't progressing as expected. The competitive landscape in the market deteriorated.