Summary of the Conference Call for JieJie Microelectronics Industry and Company Overview - JieJie Microelectronics operates in a diverse downstream market, with industrial and consumer sectors accounting for over 80% of its revenue, while the automotive sector contributes 13.1% and the communication sector is minimal [2][4] - The company’s eight-inch wafer production capacity is nearly saturated at approximately 130,000 pieces per month, while the six-inch line has an actual shipment of about 50,000 pieces per month, below its design capacity [2][6][17] Key Financial Performance - In Q3 2025, JieJie Microelectronics reported revenue of 2.5 billion yuan and a net profit of 340 million yuan, both showing year-on-year growth, although net profit decreased compared to the previous quarter due to market volatility [3] - The company has set an annual sales target of 3.5 billion yuan, with 900 million yuan achieved by the end of Q3, indicating a strong likelihood of meeting the target [12] Margin and Pricing Dynamics - Q3 gross margins varied significantly across product lines: 39% for thyristors, 30% for protective devices, and 21.3% for MOSFETs, which were heavily impacted by price fluctuations [7][9] - Rising raw material costs and intensified market competition have exerted downward pressure on prices, particularly for thyristors and MOSFETs, which saw a decline of 6 percentage points [9][15] Product Development and Market Position - The company is actively pursuing new projects, including a module project expected to ship by the end of 2025 and an optocoupler project anticipated to generate tens of millions in revenue this year [8][19] - JieJie Microelectronics aims to compete with Anshi Semiconductor, particularly in areas outside of ESD, where it has shown some weakness [10][13] Competitive Landscape - The company faces challenges from overseas competitors who have shifted some production to domestic facilities, impacting its thyristor business [11] - Despite this, JieJie Microelectronics maintains a competitive edge through customized products, which help mitigate competitive pressures [11] Future Outlook and Strategic Directions - The company expects a slight increase in orders for Q4 compared to Q3, although growth may be uncertain due to competitive dynamics and price instability [5][16] - Long-term growth areas identified include energy storage, photovoltaics, automotive electronics, and AI computing power [21][25] - The company plans to maintain a standard inventory level, with over half of its stock consisting of MOS products [22][24] Capital Expenditure and Production Capacity - JieJie Microelectronics has no major capital expenditure plans in the short term, having already invested significantly in its eight-inch line and other projects [24] - The company’s production capacity is expected to increase further in 2026, with a target of producing 1.5 million eight-inch wafers [17][18] Conclusion - JieJie Microelectronics is navigating a complex market environment with a focus on maintaining competitive pricing, expanding its product offerings, and targeting long-term growth sectors while managing production capacity and costs effectively [25]

Core Viewpoint - Jiejie Microelectronics reported a revenue of 2.502 billion yuan for the first three quarters of 2025, a year-on-year increase of 24.70%, while net profit attributable to shareholders was 347 million yuan, a slight increase of 4.30% [1] Financial Performance - In Q3 2025, Jiejie Microelectronics achieved a revenue of 901 million yuan, a year-on-year growth of 21.19%, but net profit decreased by 15.65% to 100 million yuan [1] - The gross margin for Q3 2025 was 28.11%, down 12.04 percentage points year-on-year and 3.75 percentage points quarter-on-quarter [5] - For the first three quarters of 2025, the gross margin was 32.77%, with Q1 and H1 margins at 36.88% and 35.57%, respectively [4] Industry Context - The power semiconductor industry has faced demand adjustments and price competition over the past two years, leading to a decline in overall profit levels [1] - As of 2025, demand is expected to improve, and price competition is gradually easing, which may enhance profits for leading manufacturers [1] Product Performance - In Q1 2025, the gross margins for different product lines were as follows: thyristors at 44.16%, protective devices at 33.19%, and MOSFETs at 41.05% [4] - The company has adjusted prices for some products due to intense market competition, with a slight decrease in prices for certain thyristor products and a 10%-15% drop for some MOSFET products [4] Inventory and Orders - As of Q3 2025, contract liabilities reached 16.1626 million yuan, a 75.57% increase from the beginning of the year, indicating a rise in order volume [6] - Inventory stood at 781 million yuan, a 30.39% increase from the start of the year, driven by increased sales volume [6] Market Expansion - Jiejie Microelectronics is expanding into emerging markets such as aerospace, automotive electronics, IT products, and robotics while maintaining its position in traditional markets [8] - By H1 2025, revenue from the automotive sector accounted for 15.79% of total revenue, with industrial and consumer sectors at 43.55% and 36.25%, respectively [9]

Macro and Strategy - The fixed income investment strategy for Q4 indicates a turning point year, with expectations for a cooling economy and potential interest rate cuts [8][11] - The report highlights the ongoing industrialization of solid-state batteries, supported by government policies and advancements in materials and applications [17][18] Textile and Apparel - The textile and apparel sector shows resilience in mid-term performance, with the sports segment leading apparel consumption [3][11] - In September, the retail sales of clothing increased by 1.8% year-on-year, with e-commerce growth rebounding significantly [12][13] - The textile manufacturing segment reported a revenue increase of 7.8% in H1 2025, while the apparel and home textile segment faced a decline of 6.4% [15] Electric Power Equipment and New Energy - The solid-state battery industry is progressing, with significant policy support and material advancements leading to increased production and application [17][18] - Domestic energy storage system tenders surged to 47.2 GWh in August 2025, reflecting a 2158% year-on-year increase, indicating strong demand for new energy systems [18] - The electric power equipment sector is expected to benefit from increased capital expenditures, particularly in AI and cloud infrastructure [18][19] Pharmaceutical and Biotechnology - The pharmaceutical sector is experiencing strong performance, with a notable increase in interest in ANGPTL3-targeted therapies, particularly from multinational corporations [21][22] - The overall biopharmaceutical sector outperformed the market, with a TTM P/E ratio of 40.75x, indicating robust investor interest [20] Non-Banking Financial Sector - The securities industry reported a revenue increase of 11.37% year-on-year in H1 2025, driven by strong performance in brokerage and investment segments [22][23] - Financial investment assets have become the primary growth area for securities firms, accounting for nearly 50% of total assets [24] Social Services Industry - The education and human resources sector showed overall growth, with a revenue increase of 11% and a profit increase of 28% in H1 2025 [26][27] - The K12 education segment continues to recover, with significant demand for skills training and a shift towards quality education [28][30] Internet Industry - The AI agent market is rapidly evolving, with significant growth expected in AI infrastructure and applications, particularly in B2B and B2C sectors [31][34] - Major cloud providers are enhancing their AI capabilities, with Microsoft, Google, and Amazon leading the market [34][35] Agriculture, Forestry, Animal Husbandry, and Fishery - The report recommends focusing on the meat and dairy sectors, highlighting the positive outlook for low-cost pig farming and the overall livestock cycle [36]

Core Viewpoint - The company has demonstrated significant growth in revenue and net profit in the first half of 2025, driven by its focus on power semiconductor devices and the expansion into automotive electronics [1][2][3] Group 1: Financial Performance - In 1H25, the company achieved a net profit attributable to the parent company of 246 million yuan, representing a year-on-year increase of 46.57% [1] - The total revenue for 1H25 reached 1.6 billion yuan, reflecting a year-on-year growth of 26.77% [1] - In Q2 2025, the company reported revenue of 901 million yuan, which is a year-on-year increase of 21.21% and a quarter-on-quarter increase of 28.67% [1] Group 2: Product Performance - The revenue from MOSFET products has accelerated, becoming the largest revenue source for the company, contributing 753 million yuan in 1H25, which accounts for 47.75% of total revenue and shows a year-on-year growth of 33.69% [2] - The company’s core products, including thyristors and protective devices, maintained stable performance, with thyristors generating 283 million yuan in revenue (18% of total revenue, YoY +1.12%) [2] - Revenue from protective devices increased to 541 million yuan (34% of total revenue, YoY +34.32%) due to the expansion of 6-inch production capacity [2] Group 3: Strategic Initiatives - The company has completed the acquisition of the remaining 8.45% stake in Jie Jie Nantong Technology for 284 million yuan, achieving 100% ownership, which is expected to enhance profitability [3] - A new subsidiary in Chengdu has been established to focus on high-end isolation chip products, which has already generated sales revenue and is anticipated to provide new growth opportunities [3] - The company is strategically targeting the automotive electronics sector, with automotive revenue accounting for 15.79% of total revenue in 1H25, and over 80% of this revenue coming from MOSFET products [2]

Investment Rating - The investment rating for the company is "Outperform the Market" [6] Core Views - In 1H25, the company achieved a year-on-year growth of 46.57% in net profit attributable to the parent company, driven by the accelerated expansion in automotive electronics, with total revenue reaching 1.6 billion yuan, a 26.77% increase year-on-year [1] - The company operates primarily in the power semiconductor sector, with key products including thyristors, protection devices, and MOSFETs. The revenue from MOSFETs has become the largest income source, contributing 755 million yuan in 1H25, which is 47.75% of total revenue, reflecting a 33.69% year-on-year growth [2] - The automotive electronics segment is a strategic focus, with revenue from this sector accounting for 15.79% of total revenue in 1H25, primarily from MOSFET products [3] - The company completed the acquisition of the remaining 8.45% stake in its subsidiary, JieJie Nantong Technology, achieving 100% ownership, which is expected to enhance profitability [3] Financial Performance and Forecast - The company forecasts net profits of 556 million yuan, 708 million yuan, and 850 million yuan for the years 2025, 2026, and 2027 respectively, with corresponding PE ratios of 39.8, 31.3, and 26.1 [4] - Revenue projections for the years 2023 to 2027 are 2.106 billion yuan, 2.845 billion yuan, 3.621 billion yuan, 4.360 billion yuan, and 5.291 billion yuan, reflecting growth rates of 15.5%, 35.1%, 27.3%, 20.4%, and 21.3% respectively [5]

Summary of Conference Call for JieJie Microelectronics Company Overview - JieJie Microelectronics reported a revenue of 1.6 billion yuan and a total profit of 270 million yuan for the first half of the year, showing year-on-year growth. The non-recurring net profit increased by 46%, primarily due to the disposal of an old factory asset [2][3]. Revenue Breakdown - Revenue by product segments: - MOS products: 753 million yuan (47%) - Thyristors: 283 million yuan (17%) - Protection devices: 541 million yuan (34%) [4]. Capacity and Utilization - The company's production capacity is nearly at full utilization, with the 8-inch line producing approximately 110,000 wafers monthly, and an output of about 100,000 wafers [13]. - The depreciation expense for the production line is estimated to be around 800 million yuan for 2025 [14]. Market Conditions and Pricing - The overall market is in a slow recovery phase with intense competition. The company adjusted the prices of some MOS products downwards by 4% to 15% in April and May, leading to a decrease in gross margin [6][3]. - The gross margins for different products are as follows: - Thyristors: 44.8% - Protection devices: 30% - MOS: 33% [6]. Downstream Application Areas - The distribution of downstream application areas is as follows: - Industrial: 43.55% - Consumer: 36.25% - Automotive: 15.79% - Communication: 1.82% [7]. Future Outlook and Goals - The company has adjusted its revenue target for the second half of the year to 2 billion yuan, with growth expected mainly from industrial (light storage, servers), consumer, and automotive electronics sectors [5][17]. - The company plans to launch approximately 200 automotive-grade MOSFET products this year [21]. R&D and Innovation - The company collaborates with research institutions to develop third-generation semiconductors, although high costs have delayed mass production. The R&D expense ratio for the second quarter was 5%, with an expectation of at least 6% for the year [5][24]. - There is a significant potential for domestic power semiconductor localization, with 70% of the market still open for domestic substitutes [22]. Inventory and Cash Flow - The company maintains a good inventory level, primarily stocking MOS products to meet varying demands [25]. - The strong operating cash flow is attributed to the gradual increase in capacity, especially in the 8-inch line [8]. Strategic Investments - The company is focusing on project investments and mergers to expand its product structure in response to market changes and to seize opportunities during industry consolidation [28]. Conclusion - JieJie Microelectronics is navigating a competitive landscape with strategic pricing adjustments, a focus on automotive applications, and ongoing R&D efforts to enhance its market position and product offerings. The company aims to leverage its strengths in the semiconductor market while addressing challenges posed by market dynamics.

Group 1 - The company, JieJie Microelectronics (300623.SZ), currently has a secondary supplier relationship with Huawei [1] - The company has certain MOSFET products that can be applied in the photovoltaic inverter sector [1] - Some protective devices are used in Huawei's mobile phone fast charging through indirect cooperation [1]