Investment Rating - The investment rating for the company is "Recommended" (maintained) with a stock price of 243.3 yuan [1]. Core Views - The company reported a revenue of 1.938 billion yuan for the first half of 2025, representing a year-on-year growth of 26.58%, and a net profit attributable to shareholders of 305 million yuan, which is a 106.45% increase year-on-year [3][6]. - The company focuses on low-power wireless computing SoC chips, continuously increasing its market share in the smart wearable and smart home markets, which has led to a significant rise in both gross and net profit margins [6][7]. - The BES2800 chip has been successfully introduced and is rapidly gaining traction in the market, further solidifying the company's technological leadership [7]. Financial Performance Summary - Revenue projections for the company from 2023 to 2027 are as follows: 2.176 billion yuan in 2023, 3.263 billion yuan in 2024, 4.511 billion yuan in 2025, 6.036 billion yuan in 2026, and 7.583 billion yuan in 2027, with year-on-year growth rates of 46.6%, 49.9%, 38.2%, 33.8%, and 25.6% respectively [5]. - Net profit projections for the same period are: 124 million yuan in 2023, 460 million yuan in 2024, 807 million yuan in 2025, 1.208 billion yuan in 2026, and 1.597 billion yuan in 2027, with year-on-year growth rates of 1.0%, 272.5%, 75.2%, 49.7%, and 32.2% respectively [5]. - The company's gross margin is expected to improve from 34.2% in 2023 to 41.2% in 2027, while the net margin is projected to increase from 5.7% to 21.1% over the same period [5][9]. Market Position and Strategy - The company has successfully onboarded new clients in the smart watch market, including Xiaotianzi and Songtuo, and has maintained rapid growth in chip shipments for smart watches [7]. - The company is evolving towards becoming a platform chip company in the low-power wireless computing SoC field, with applications extending to smart glasses and wireless microphones [7]. - The company has established a strong brand influence and technical capability in the industry, recognized by clients for its product offerings [7].

Core Insights - Hengxuan Technology (Shanghai) Co., Ltd. reported a significant increase in revenue and net profit for the first half of 2025, with revenue reaching 1.938 billion yuan, a year-on-year growth of 26.58%, and net profit attributable to shareholders at 305 million yuan, up 106.45% [1][2] Financial Performance - The company achieved a gross margin of 39.3%, an increase of 6.1 percentage points year-on-year, which contributed to the rapid growth in net profit [1] - The non-recurring net profit was 284 million yuan, reflecting a year-on-year increase of 153.37% [1] Market Position and Product Development - Hengxuan Technology focuses on the design and development of low-power wireless computing SoCs, with a strong emphasis on the smart wearable and smart home markets, leading to an increase in market share [1] - The new generation smart wearable chip, BES2800, has been widely adopted in customer products such as smartwatches and smart glasses, reinforcing the company's technological leadership in the industry [1] Customer Base and Product Expansion - The company successfully onboarded new domestic and international clients in the smartwatch market, including Xiaotianzi and Songtuo, leading to rapid growth in chip shipments for smartwatches [1] - Beyond Bluetooth headsets and smartwatches, the company's chips are gradually extending into low-power wireless applications such as smart glasses and wireless microphones [1] Research and Development - Hengxuan Technology maintained a high level of R&D investment, with expenses amounting to 395 million yuan, a year-on-year increase of 22.77% [2] - As of the end of the reporting period, the total number of R&D personnel reached 621, accounting for 86.25% of the workforce [2]

Core Viewpoint - Hengxuan Technology focuses on the design and development of low-power wireless computing SoC chips, with significant growth in revenue and customer base for its wearable chips, particularly the BES2800 series, which is expanding into smart glasses and low-power Wi-Fi markets [1][3] Group 1: Company Performance - In 2024, the company's revenue is expected to grow by 116% year-on-year, reaching 1.045 billion yuan, with a shipment volume exceeding 40 million units [1] - The BES2800 series chip serves as the flagship wearable platform, enhancing applications in smart glasses and low-power Wi-Fi, moving towards becoming a platform chip company [1][3] Group 2: Technological Advancements - The BES2800 chip, built on a 6nm FinFET process, integrates multi-core CPU/GPU, NPU, large storage, low-power Wi-Fi, and dual-mode Bluetooth, significantly improving performance and power efficiency [1] - The chip supports health algorithms for heart rate and blood oxygen monitoring, achieving over 20 days of battery life through dynamic power management technology [1] Group 3: Product Applications - The BES2800-based smart glasses solution features integrated audio input/output for lightweight model operation and low-power dual-mode Wi-Fi/BT for responsive online voice AI needs, enhancing user experience with longer wear times [2] - The BES2800 platform supports high-bandwidth, low-latency audio transmission, meeting the demands of professional audio equipment, and surpassing traditional Bluetooth audio transmission capabilities [2] Group 4: Future Projections - The company is expected to achieve revenues of 4.705 billion, 6.067 billion, and 7.621 billion yuan in 2025, 2026, and 2027 respectively, with net profits of 884 million, 1.245 billion, and 1.685 billion yuan [3]