Amlogic(SH:688099) HTSC·2025-10-30 08:50Investment Rating - The report maintains a "Buy" rating for the company with a target price of 120.80 RMB [6][4]. Core Views - The company achieved a revenue of 5.071 billion RMB in the first three quarters of 2025, representing a year-over-year increase of 9.29%, and a net profit of 698 million RMB, up 17.51% year-over-year. However, the revenue in Q3 2025 slightly declined by 3.33% quarter-over-quarter due to rising storage prices and shortages, leading to delayed customer demand [1][2][4]. - The company is expected to benefit from the growth of AI edge applications, with a clear product iteration plan and continuous volume increase in 6nm and WiFi6 products [1][4]. Summary by Sections Financial Performance - In Q3 2025, the company reported revenue of 1.741 billion RMB, a year-over-year increase of 7.20%, but a quarter-over-quarter decrease of 3.33%. The net profit for the same period was 201 million RMB, down 13.14% year-over-year and 34.76% quarter-over-quarter [1][2]. - The gross margin improved to 37.74%, up 0.45 percentage points quarter-over-quarter, driven by enhanced operational efficiency [2][4]. Product Development and Market Position - The company has established deep collaborations with major clients like Google and Samsung in smart home and AIoT sectors, leading to significant shipment growth of over 150% and 100% respectively in the first three quarters [2]. - The company anticipates that delayed orders due to storage price hikes will gradually be released in subsequent quarters, with a strong outlook for its 6nm product series and WiFi6 offerings [3][4]. Future Outlook - Revenue projections for 2025-2027 are estimated at 6.831 billion RMB, 8.264 billion RMB, and 10.569 billion RMB respectively, with net profits expected to be 931.96 million RMB, 1.341 billion RMB, and 1.996 billion RMB [4][10]. - The company is set to launch new high-performance SoC products and expand its WiFi product matrix, which is expected to contribute significantly to revenue growth [3][4].