Amlogic(SH:688099) HTSC·2025-08-13 12:46Investment Rating - The report maintains a "Buy" rating for the company [4][6]. Core Views - The company achieved a revenue of 1.801 billion RMB in Q2 2025, representing a year-over-year increase of 9.94% and a quarter-over-quarter increase of 17.72%. The net profit attributable to the parent company was 308 million RMB, up 31.46% year-over-year and 63.90% quarter-over-quarter [1][2]. - The growth in revenue is primarily driven by the demand increase from the smart home market and the launch of new products such as the 6nm flagship products and WiFi6 chips [1][2]. - The company expects further growth in Q3 2025 and for the entire year of 2025, supported by the acceleration of product launches and upgrades to meet the higher computational demands of edge AI applications [1][4]. Summary by Sections Q2 2025 Review - The company reported record-high quarterly revenue and shipment volumes, with A-series product sales growing over 50% year-over-year in both 1H25 and Q2 2025. WiFi chip shipments exceeded 5 million units in Q2 2025, with WiFi 6 accounting for nearly 30% of shipments [2]. - The gross margin for Q2 2025 was 37.29%, benefiting from product mix optimization and improved operational efficiency [2]. Outlook for H2 2025 - As of the end of Q2, the company's advance payments reached 620 million RMB, reflecting increased inventory to meet strong downstream demand. The company anticipates continued year-over-year growth in Q3 2025 and for the full year [3]. - The company plans to launch new high-end TV SoC products and flagship A-series products in the second half of 2025, aiming to enhance market share and meet greater computational needs [3]. Investment Recommendations - The target price is set at 100.5 RMB, with an upward revision from the previous target of 88.9 RMB, based on a 35x PE for 2025. The expected net profits for 2025-2027 are projected at 1.208 billion, 1.504 billion, and 1.823 billion RMB, respectively [4][8].