Hua Hong Semiconductor (1347) investor relations material

Executive summary

• Q1 2026 revenue reached $660.9 million, up 22.2% year-over-year and 0.2% sequentially, with gross margin at 13%, a 3.8 percentage point increase year-over-year, both in line with guidance.

• Net profit attributable to shareholders was $20.9 million, up 458.1% year-over-year and 19.9% sequentially.

• High capacity utilization maintained across all process technology platforms, with 12-inch wafer revenue contribution rising to 62.7%.

• MCU, standalone flash, and BCD products showed the highest growth.

• Acquisition of Huali Micro accepted by Shanghai Stock Exchange and expected to close in H2 2026.

Financial highlights

• Revenue grew 22.2% year-over-year and 0.2% sequentially, driven by increased wafer shipments and ASP.

• Gross margin improved to 13% year-over-year, flat sequentially.

• Operating expenses were $105.6 million, up 8.8% year-over-year, down 18.9% sequentially.

• Net cash from operating activities was $130.4 million, up 159.9% year-over-year.

• CapEx in Q1 2026 was $924.9 million, mainly for 12-inch capacity expansion.

Outlook and guidance

• Q2 2026 revenue expected between $690 million and $700 million, with gross margin projected at 14%-16%.

• Revenue growth for Q2 expected to be close to 5% quarter-over-quarter, driven by both ASP and volume growth.

• Average wafer price increases expected to be around 10%-15% for the year, with some platforms seeing up to 20%-25%.

• Acquisition of Huali Micro expected to close in 2H 2026.