Summary of Conference Call for Gongjin Co., Ltd. Industry Overview - The company benefits from increased investments in AI, leading to significant growth in demand for computing infrastructure and an expanding data center switch market. [2][4] - The AI server market is experiencing rapid development, with technological advancements enhancing value. [5] Core Insights and Arguments - Gongjin Co., Ltd. turned a profit in the first half of 2025, with improved profit margins. The network communication business benefited from a recovery in overseas markets, while the data communication business thrived due to high demand for data center switches. [2][6] - The revenue structure changed significantly in the first half of 2025, with overseas revenue from network communication products rising to 70%, which is 14 percentage points higher in gross margin compared to domestic sales. [2][7] - The company is strategically focusing on AI hardware manufacturing, particularly in automotive electronics and EMS (Electronic Manufacturing Services), with EMS showing rapid growth and a projected output nearing 300 million yuan in the first half of 2025. [2][8] Financial Performance - Gongjin Co., Ltd. achieved a turnaround in profitability in the first half of 2025, with a notable recovery in the overseas market for network communication and strong growth in data center switch manufacturing. The company shipped over 17,000 servers in the first half of 2025, with expectations for further acceleration in the second half. [6][11] - The revenue structure saw a significant shift, with overseas revenue from network communication products reaching 70%, compared to a balanced domestic and overseas revenue split in the previous year. [7] Emerging Directions in AI Hardware Manufacturing - The company is focusing on automotive electronics and EMS, with a positive outlook for order growth in automotive electronics and rapid expansion in EMS. [8] Strategic Focus Areas - Gongjin Co., Ltd. plans to focus on two main areas: traditional communication business (including optical, wireless, and mobile terminals) and AI-related sectors, including data centers, key components for smart vehicles, and components for new energy vehicles. [9] Additional Important Insights - The company is actively participating in the AI server market, with expectations that AI servers will account for over 50% of total shipments in the coming years, potentially reaching 70%. [11] - The company has established a presence in the North American and Mexican markets, with production facilities in Vietnam expected to grow by 50% in 2025. [16] - The company is optimistic about the FTTR (Fiber to the Room) product market in China, anticipating a gradual increase in market share despite short-term competitive pressures. [15] - The automotive electronics sector is still in the investment phase, with increasing demand but not yet achieving profitability. [22] Conclusion - Gongjin Co., Ltd. is well-positioned in the current AI and technology bull markets, with strong growth in infrastructure equipment demand and promising developments in automotive electronics and EMS. The company’s financial performance is improving, and it is expected to continue its growth trajectory. [26]