Summary of the Conference Call for Hushi Silicon Industry Company Overview - **Company**: Hushi Silicon Industry - **Industry**: Semiconductor Silicon Wafer Manufacturing Key Points and Arguments Financial Performance - **Revenue**: In the first half of the year, revenue reached 697 million yuan, with Q2 showing a quarter-on-quarter growth of 11.75% [2] - **Net Profit**: Despite revenue growth, the net profit remains negative due to delayed recovery in the silicon wafer market, capacity expansion, and high R&D investments [2][4] Production Capacity and Market Position - **300mm Wafer Capacity**: The company leads in the domestic market with a capacity of 750,000 wafers per month and has over 100 cumulative customers [2][5] - **Product Applications**: Products are used in logic chips, storage, and have gained recognition in high-end silicon and AI data centers [2][5] - **Utilization Rates**: The utilization rate for 300mm wafers is over 90%, while the 200mm wafer utilization is around 60%-70% [11] R&D and Product Development - **R&D Investment**: R&D spending reached 155 million yuan in the first half, a year-on-year increase of 25.88%, focusing on high-power and high-performance logic chips [2][6] - **Product Development**: The company has developed over 50 new 300mm wafer products and aims to increase the sales proportion of 300mm wafers to over 80% [5][6] Market Expansion Plans - **Market Strategy**: Plans to enhance market expansion towards advanced processes, AI data centers, and silicon photonics, targeting a 20% overseas sales ratio for 300mm wafers [7] - **Growth Drivers**: The expansion of AI applications in smart driving and wearable devices is expected to drive demand in the upstream supply chain [7] Pricing and Market Trends - **Silicon Wafer Prices**: Prices for silicon wafers are under pressure, with 200mm and smaller sizes having reached a bottom. Prices are expected to gradually recover as end-user demand increases [8][10] - **ASP Trends**: The average selling price (ASP) is anticipated to rise with the growth of AI applications and increased domestic production [23] Future Outlook - **Market Recovery**: The semiconductor market is expected to improve, but recovery speed is slower than anticipated. The company remains optimistic about future growth driven by AI and emerging markets [9][12] - **Depreciation and Capital Expenditure**: Depreciation is expected to increase by over 30% in 2025 due to new equipment, with a long-term view of decreasing depreciation costs after initial investments [11][20] Competitive Landscape - **Domestic vs. International**: The company is positioned to increase its market share against international competitors, with expectations of domestic silicon wafer usage rising significantly as long-term contracts with overseas suppliers expire [25] Customer Inventory Situation - **Inventory Levels**: Current customer inventory is approximately double the historical average, indicating a need for inventory digestion before demand can fully recover [13] Conclusion - **Strategic Focus**: The company is committed to enhancing its technological capabilities, expanding its market presence, and improving profitability through innovative product development and strategic market positioning [9][21]