Core Viewpoint - Jing Sheng Mechanical and Electrical announced the successful delivery of its self-developed 12-inch atmospheric silicon epitaxy equipment to leading domestic customers, achieving international advanced levels in key performance indicators such as resistivity, thickness uniformity, epitaxial layer defect density, production efficiency, and process repeatability [1] Group 1: Product Development and Delivery - The company is actively promoting customer validation for new products including the 12-inch dry-in-dry-out edge grinding machine and the 12-inch double-sided thinning machine [1] - The 12-inch silicon reduced pressure epitaxy growth equipment has successfully achieved sales, utilizing a single temperature zone and multi-temperature zone closed-loop control mode, combined with multi-vacuum zone precise pressure control technology to ensure high stability during the epitaxy growth process [1] Group 2: Technological Advancements - The unique flat cavity structure and multi-port diversion system design of the equipment significantly enhance the film thickness uniformity and doping uniformity of the epitaxial layer, meeting the high standards required for advanced processes [1] - The company has successfully developed ultra-fast ultraviolet laser grooving equipment for advanced packaging applications, filling a gap in the domestic high-end ultraviolet laser grooving technology field and achieving domestic substitution [1]

Core Viewpoint - The photovoltaic industry is experiencing significant performance impacts due to cyclical fluctuations, leading to a substantial decline in revenue and profitability for companies in the sector [1][2]. Financial Performance - In H1 2025, the company's revenue was 5.8 billion yuan, a year-on-year decrease of 42.9%, with equipment and services revenue at 4.08 billion yuan (down 44.6%) and materials revenue at 1.23 billion yuan (down 48.2%) [1] - The net profit attributable to the parent company was 640 million yuan, a year-on-year decline of 69.5% [1] - In Q2 2025, the single-quarter revenue was 2.66 billion yuan, down 52.8% year-on-year and 15.2% quarter-on-quarter, with net profit of 70 million yuan, a 93.6% year-on-year decline [1] Profitability Metrics - The gross margin for H1 2025 was 24.4%, a decrease of 12.6 percentage points year-on-year, with equipment and services gross margin at 32.9% (down 4.5 percentage points) and materials gross margin at 6.22% (down 33.9 percentage points) [2] - The net profit margin was 10.7%, down 12.8 percentage points year-on-year, with a period expense ratio of 13.0%, an increase of 4.2 percentage points [2] - In Q2 2025, the gross margin was 20.6%, down 11.2 percentage points year-on-year and 6.9 percentage points quarter-on-quarter, with a net profit margin of 2.3%, down 16.2% year-on-year and 15.5% quarter-on-quarter [2] Inventory and Cash Flow - As of Q2 2025, contract liabilities were 3.17 billion yuan, a year-on-year decrease of 62.1%, and inventory was 8.95 billion yuan, down 35.0% [2] - The company reported a net cash flow from operating activities of 450 million yuan in H1 2025, an increase of 55.8% year-on-year [2] Product Development and Market Position - The company focuses on large silicon wafers, advanced packaging, advanced processes, and silicon carbide equipment, providing comprehensive solutions for crystal growth, slicing, grinding, and polishing [3] - The company has developed various silicon carbide equipment and has planned a total production capacity of 900,000 pieces for silicon carbide substrates, with significant partnerships in the AR glasses sector [3] Subsidiary Performance - The subsidiary, Jinghong Precision, specializes in high-precision components and has capabilities in special welding, assembly testing, and semiconductor-level surface treatment, targeting high-end product markets [4] - The profit forecast for the company has been adjusted downwards for 2025-2027, but the growth potential across multiple business lines remains [4]

Summary of Jinsheng Electric's Conference Call Company Overview - **Company**: Jinsheng Electric - **Industry**: Semiconductor and Photovoltaic Equipment Key Points Financial Performance - In the first half of 2025, Jinsheng Electric achieved a revenue of 5.799 billion yuan and a net profit attributable to shareholders of 639 million yuan [3] - The company reported a net cash inflow from operating activities of 447 million yuan, a year-on-year increase of 55.84%, indicating improved financial management [2][4] Business Segments - Jinsheng Electric focuses on three main business segments: semiconductor equipment, substrate materials, and consumables [2] - The company has over 3.7 billion yuan in unfulfilled contracts for integrated circuits and compound semiconductor equipment as of June 30, 2025 [3] Semiconductor Equipment - The company successfully delivered 12-inch silicon epitaxy equipment to leading domestic clients and is promoting 8-inch silicon carbide (SiC) epitaxy equipment [3] - New products such as the 12-inch dry-in dry-out edge polishing machine and double-sided thinning machine are undergoing customer validation [3] - Jinsheng Electric is a market leader in large silicon wafer equipment and is expanding its overseas market for semiconductor components and consumables [3][4] Photovoltaic Equipment - The company is optimistic about the long-term development of the photovoltaic industry and is addressing overcapacity challenges through technological innovations [2][5] - New products like Topcon efficiency EPD equipment and BC end silver-free multi-wire welding equipment are expected to have a positive impact from 2025 to 2026 [5][6] Silicon Carbide (SiC) Development - Jinsheng Electric has made significant advancements in 12-inch SiC crystal growth technology and is validating 8-inch SiC substrates with global customers [2][4] - The company plans to produce 600,000 wafers per month to meet future market demand, anticipating that 8-inch SiC will fully replace 6-inch [2][7] - The expected turning point for SiC development is projected for 2026-2027, particularly in the automotive sector [3][11] Market Outlook - The company expects a significant increase in demand for 8-inch conductive chips and MOSFETs by 2026-2027, driven by investments from major players like Infineon [9][11] - The photovoltaic industry is recovering from a downturn, and Jinsheng Electric is focused on maintaining order expansion and enhancing competitiveness through innovation [16] Challenges and Strategies - The company faces challenges in the photovoltaic equipment sector due to intense competition and cash flow pressures, particularly in the dry pot and diamond wire segments [28] - Jinsheng Electric is committed to continuous investment in key areas to ensure long-term sustainable development despite current financial performance not meeting expectations [29] Inventory and Supply Chain - The company maintains a lean inventory in the photovoltaic sector, while semiconductor components are stocked due to the long cycle nature of the industry [20] Conclusion - Jinsheng Electric is strategically positioned in the semiconductor and photovoltaic equipment markets, with a focus on innovation and expansion to capture future growth opportunities in the SiC and photovoltaic sectors [2][3][4][5][6][7][11][16][29]

Financial Performance - The company achieved operating revenue of 579,895.11 million yuan in the first half of 2025, with a decline in revenue and profit from photovoltaic equipment and materials due to cyclical adjustments in the industry [2] - The semiconductor business continued to grow, with unfulfilled contracts for integrated circuits and compound semiconductor equipment exceeding 3.7 billion yuan as of June 30, 2025 [2] Semiconductor Equipment Development - The company successfully delivered 12-inch atmospheric silicon epitaxy equipment to leading domestic customers, achieving international advanced levels in key performance indicators [3] - New products such as the 12-inch dry-in-dry-out edge grinding machine and 12-inch double-sided thinning machine are undergoing customer validation [3] Silicon Carbide Substrate Progress - The company made significant breakthroughs in the growth of 12-inch conductive silicon carbide crystals, addressing core challenges in temperature uniformity and crystal cracking [4] - The company is expanding its global customer verification for 8-inch silicon carbide substrates and has received bulk orders from international clients [4] Semiconductor Components and Materials - The subsidiary, Jinghong Precision, is enhancing its manufacturing capabilities for core components, focusing on precision processing and special welding [5] - The company has achieved domestic substitution for semiconductor quartz crucibles, leading the market share and overcoming technical bottlenecks for large-sized crucibles [5] Sapphire Business Growth - The sapphire material business experienced year-on-year growth driven by new applications in LED and consumer electronics sectors [5] Customer Base and Risk Management - The company has established a strong reputation among high-end clients in the semiconductor and photovoltaic industries, with long-term strategic partnerships [6] - To mitigate order fulfillment risks, the company focuses on large, financially stable clients and implements strict credit management and contract practices [6]