And I'm here to tell you about something I'm truly passionate about. Metals are everywhere. They're absolutely everywhere in everything that we touch.So ingrained in our daily lives that we barely even notice them. for the transportation that got you to this room today. The the trains, the planes, the automobiles, the electric vehicles, your smartphones.Everything's smart nowadays, isn't it. You have smartphones, smart watches, smart TVs. Even my oven is smarter than me. These are all comprised of precious ...

The Stock Exchange of Hong Kong Limited and the Securities and Futures Commission take no responsibility for the contents of this Post Hearing Information Pack, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Post Hearing Information Pack. Post Hearing Information Pack of Huaqin Co., Ltd. 華勤技術股份有限公司 (the "Company") (A joint stock company incorporated ...

Xiaomi Corp. (1810.HK) Earnings Review Summary Company Overview - **Company**: Xiaomi Corp. (1810.HK) - **Market Cap**: HK$836.8 billion / $106.8 billion - **Enterprise Value**: HK$639.3 billion / $81.6 billion - **Current Price**: HK$32.68 - **Target Price**: HK$41.00 (25.5% upside) [5][10] Key Financial Highlights - **4Q25 Results**: Revenue grew by +7% year-over-year (YoY), slightly above Goldman Sachs estimates and below Visible Alpha consensus [1] - **Adjusted Net Profit**: Declined by -24% YoY, in line with consensus but 7% above Goldman Sachs estimates due to higher non-operating income [1] - **2026E Backbone Profit**: Estimated at Rmb33.6 billion, which is 110% of the projected group adjusted net profit of Rmb30.2 billion [1] - **Smartphone Losses**: Expected net loss of Rmb4 billion+ from smartphones on approximately 145 million shipments with a gross profit margin (GPM) of around 8% [1] Strategic Insights 1. **AI Strategy and Investments**: Xiaomi plans to invest Rmb60 billion in AI over the next three years, focusing on enhancing its ecosystem and developing embodied AI technologies [1][15] 2. **Impact of Rising Memory Costs**: Management anticipates a long-term upward cycle in memory costs through 2027, with a focus on balancing volume and margin. Smartphone GPM dropped to 8.3%, with a significant inventory provision of Rmb2.1 billion in 4Q25 [1][16] 3. **Electric Vehicle (EV) Performance**: The new SU7 model received 30,000 confirmed orders within three days, indicating strong demand. Projected EV volume for 2026E is 600,000 units with a GPM of 21.8% [1][16] 4. **IoT Market Outlook**: Xiaomi aims for premiumization in the China market and sees significant growth potential overseas, with a target of 1,000 stores by the end of 2026 [1][16] 5. **Operational Efficiency**: Non-IFRS operating expenses are expected to grow by +11% YoY to Rmb75 billion in 2026E, with core operating expenses declining by -3% YoY [1][16] Revenue and Profitability Forecasts - **Revenue Projections**: - 2025: Rmb457.3 billion - 2026E: Rmb490.3 billion - 2027E: Rmb589.3 billion - 2028E: Rmb680.7 billion [5][10] - **EBITDA**: Expected to decline significantly in 2026E to Rmb41.0 billion, with a recovery projected in subsequent years [5][10] - **EPS Growth**: Projected to decline by -24.5% in 2026E, with a recovery in the following years [5][10] Market Position and Challenges - **Market Share Decline**: Xiaomi's smartphone shipment market share declined by -2.6 percentage points quarter-over-quarter to 11% in 4Q25, with losses across all major markets [1][31][33] - **Competitive Landscape**: Competitors like Apple and OPPO have gained market share, while Xiaomi's performance has been challenged by rising costs and inventory management issues [1][35] Conclusion Xiaomi Corp. is navigating a challenging environment with declining profits and market share, but its strategic investments in AI and operational efficiencies may provide a buffer against industry headwinds. The company's focus on EVs and IoT presents potential growth avenues, although rising memory costs and competitive pressures remain significant risks. The current investment rating is "Buy" with a target price of HK$41.00, reflecting a positive outlook despite short-term challenges [1][10].

Summary of Key Points from the Conference Call Industry Overview - The conference call focused on the Greater China Technology Hardware sector, particularly the AI transceiver market and the smartphone industry outlook [1][2]. Core Insights - **AI Transceiver Market Growth**: The Total Addressable Market (TAM) for AI transceivers is projected to triple by 2028, indicating significant growth potential in this sector [6][7]. - **Market Share Dynamics**: Companies like Eoptolink and Coherent are expected to gain market share in the AI transceiver space, while Lumentum's share may decline [9][13]. - **Smartphone Market Decline**: Global smartphone shipments are forecasted to decline by 13% year-over-year in 2026, reflecting a downturn in the smartphone market [46][47]. - **Apple vs. Android Supply Chain**: The report suggests a preference for the Apple supply chain over the Android supply chain due to anticipated challenges in the latter [1]. Financial Projections - **800G/1.6T Demand Forecast**: The demand for 800G and 1.6T transceivers is expected to see a compound annual growth rate (CAGR) of 144% from 2024 to 2030 [20]. - **Valuation Changes**: Recent market rallies have led to increased valuations for transceiver companies, with Eoptolink's 12-month forward P/E ratio averaging 15.6x [38]. Competitive Landscape - **Smartphone Brand Performance**: Samsung and Honor outperformed other Android brands in 4Q25, with notable year-over-year shipment growth [55]. - **Market Share Trends**: The competitive landscape shows fluctuating market shares among major players, with Apple and Samsung maintaining significant shares in the global market [68]. Additional Insights - **Memory Costs and Supply Shortages**: There is a significant increase in memory costs and ongoing supply shortages affecting the technology hardware sector [43]. - **Inventory Trends**: Companies like MediaTek and Qualcomm are experiencing inventory fluctuations, which may impact their operational strategies moving forward [52][54]. Conclusion - The conference highlighted critical trends in the AI transceiver and smartphone markets, emphasizing growth opportunities in AI technology while cautioning about the challenges facing the smartphone industry. The competitive dynamics and financial projections suggest a complex landscape for investors to navigate in the coming years [1][46][68].

Investment Rating - The report maintains a "BUY" rating for Xiaomi, with a new target price (TP) of HK$44.47, reflecting a potential upside of 36.1% from the current price of HK$32.68 [1][3][27]. Core Insights - Xiaomi's 4Q25 results exceeded expectations, with revenue growth of +7% YoY and adjusted net profit decline of -24% YoY, outperforming Bloomberg consensus estimates by 1% and 10% respectively. This was attributed to improved smartphone average selling price (ASP) and strong performance in the smart EV segment [1][9]. - The company is well-positioned for future growth, focusing on premiumization, IoT expansion overseas, and advancements in AI capabilities, with expectations for these investments to yield results in 2026-27 [1][9]. - Adjustments to FY26-27E net profit estimates have been made, reducing projections by 4-9% due to 4Q25 results and anticipated lower gross profit margins [1][9]. Financial Summary - Revenue projections for FY26E and FY27E are set at RMB 522.3 billion and RMB 613.1 billion, respectively, with YoY growth rates of 14.2% and 17.4% [2][31]. - Adjusted net profit for FY26E is estimated at RMB 35.6 billion, reflecting a decline of 9.1% YoY, while FY27E is projected to recover to RMB 44.0 billion, showing a growth of 23.6% [2][31]. - The report highlights a decrease in gross profit margin for FY26E to 21.0% and FY27E to 22.0%, down from previous estimates [24][31]. Segment Performance - The smartphone segment reported a revenue decline of -14% YoY in 4Q25, driven by a 12% drop in shipments, despite a 7% increase in ASP [9][22]. - The smart EV segment saw a remarkable revenue increase of 122% YoY, with 145,000 deliveries and an ASP rise of 6.6% YoY, contributing positively to overall performance [9][22]. - IoT and lifestyle products experienced a revenue drop of -20% YoY, attributed to diminishing subsidy impacts in China, although overseas markets showed stronger performance [9][22]. Valuation - The target price of HK$44.47 is derived using a sum-of-the-parts (SOTP) valuation method, reflecting different growth profiles across Xiaomi's business segments [27][28]. - The implied target multiples are set at 29.5x and 23.9x for FY26E and FY27E P/E, respectively, justified by Xiaomi's market share gains and strategic initiatives [27][28].

Core Viewpoint - Xiaomi Corporation, represented by XIACY on the OTC market, is facing financial challenges despite its strong market presence in the global smartphone sector, competing with major players like Apple and Samsung [1]. Financial Performance - On March 24, 2026, XIACY reported earnings per share of $0.16, missing the estimated $0.18 [2][6]. - The company's revenue was approximately $16.93 billion, slightly below the expected $17.01 billion, attributed to rising memory chip costs increasing production expenses [2]. - Decreased consumer spending in key markets has contributed to a drop in quarterly net profit, further straining the company's financials [3]. Valuation Metrics - XIACY maintains a price-to-earnings (P/E) ratio of 16.90, indicating investor confidence in its earnings potential [3][6]. - The price-to-sales ratio is about 1.66, suggesting that investors are willing to pay $1.66 for every dollar of sales [4]. - The enterprise value to sales ratio stands at 1.63, reflecting Xiaomi's valuation relative to its sales [4]. - The enterprise value to operating cash flow ratio is approximately 11.29, providing insight into its valuation in relation to cash flow from operations [5]. - The earnings yield of 5.92% indicates a reasonable return on investment [5]. - With a debt-to-equity ratio of 0.10, XIACY has a low level of debt compared to its equity [5]. - A current ratio of 1.32 suggests the company can cover short-term liabilities with short-term assets [5].

Financial Data and Key Metrics Changes - In 2025, the total group revenue reached RMB 457.3 billion, marking a 25% year-on-year increase and surpassing the RMB 400 billion mark for the first time [5][16] - Adjusted net profit for 2025 was RMB 39.2 billion, up 44% year-on-year, achieving a record high [5][23] - Overall gross profit margin improved to 22.3%, up 1.3% year-on-year, also a historical high [16] Business Segment Data and Key Metrics Changes - Revenue from the smartphones and IoT segment was RMB 351.2 billion, up 5.4% year-on-year, with a gross profit margin of 21.7% [17] - Smartphone revenue was RMB 186.4 billion, accounting for 40.8% of total revenue, with global shipments reaching 165 million units [17][18] - IoT revenue surpassed RMB 120 billion for the first time, reaching RMB 123.2 billion, reflecting an 18.3% year-on-year growth [7][19] - The smart EV and AI innovation business segment achieved annual revenue of RMB 106.1 billion, up over 200% year-on-year, and recorded an operating profit of RMB 0.9 billion for the first time [21][23] Market Data and Key Metrics Changes - In 2025, Xiaomi maintained a global smartphone market share of 13.3%, ranking in the top three for 22 consecutive quarters [5][18] - In Mainland China, Xiaomi's smartphone sales ranking rose to second, with premium models accounting for 27.1% of total smartphone sales, up 3.8 percentage points year-on-year [6][17] - The company achieved significant growth in overseas markets, particularly in Latin America and Southeast Asia, where shipment rankings improved to second [5] Company Strategy and Development Direction - Xiaomi plans to focus on breakthroughs in hardcore technology, particularly in AI and embodied intelligence, with R&D investment exceeding RMB 33 billion in 2025 and projected to exceed RMB 40 billion in 2026 [9][21] - The company aims to enhance its premium product offerings and expand its presence in mature international markets [6][7] - Xiaomi is committed to integrating AI into its ecosystem, with plans to invest RMB 60 billion in AI over the next three years [12][21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the second half of 2025 but expressed confidence in achieving growth targets for 2026 [16][52] - The company is aware of rising memory prices impacting the smartphone segment but aims to manage costs while protecting consumer pricing [27][59] - Management emphasized the importance of maintaining market position and competitive advantages through strong supplier relationships and inventory management [33][60] Other Important Information - Xiaomi's share repurchase program totaled approximately HKD 6.3 billion in 2025, reflecting confidence in the company's long-term future [24] - The company achieved a management level B score in the CDP Climate Change and Water Security Survey, and a score of 81 in EcoVadis Gold Medal for ESG efforts [25] Q&A Session Summary Question: Concerns about rising memory prices and smartphone pricing strategy - Management acknowledged the impact of rising memory prices and indicated that while they aim to protect consumers, price hikes may be necessary if pressures continue [27][32][59] Question: Sales data for new generation vehicles - Management clarified that locked orders for new vehicles are primarily from new buyers, indicating strong demand and a positive outlook for future sales [34][36] Question: AI capabilities and commercialization - Management stated that while AI models are progressing, commercialization is still in early stages, with ongoing improvements expected [40][64] Question: Impact of Middle Eastern situation on business - Management noted that the Middle Eastern market contributes only a small percentage to overall revenue, and the situation remains controllable [55] Question: Future investment in chips and IoT pricing strategy - Management confirmed continued investment in chip development as a strategic capability, while also indicating that pricing strategies for IoT products will align with those for smartphones [69][70]

Financial Data and Key Metrics Changes - In 2025, total group revenue reached CNY 457.3 billion, up 25% year-on-year, marking the first time surpassing CNY 400 billion [3][12] - Adjusted net profit reached CNY 39.2 billion, up 44% year-on-year, also a record high [3][19] - Overall gross profit margin was 22.3%, up 1.3% year-on-year, a historical high [12] - Revenue from smartphones and IoT segment was CNY 351.2 billion, up 5.4% year-on-year, with a gross profit margin of 21.7% [14] - Internet service revenue hit a record CNY 37.4 billion, up 9.7% year-on-year [17] Business Line Data and Key Metrics Changes - Smartphone revenue was CNY 186.4 billion, accounting for 40.8% of total revenue, with global shipments reaching 165 million units [14][15] - IoT revenue surpassed CNY 123.2 billion, up 18.3% year-on-year, with a gross profit margin of 23.1% [5][16] - The EV and AI innovation business segment reached CNY 106.1 billion, up over 200% year-on-year, with smart EV sales revenue at CNY 103.3 billion [18] Market Data and Key Metrics Changes - In 2025, Xiaomi's global smartphone market share was 13.3%, maintaining a top three position globally for 22 consecutive quarters [3][15] - In Mainland China, Xiaomi's smartphone sales ranking rose to second, with premium models accounting for 27.1% of total smartphone sales [4][14] - In overseas markets, Xiaomi's IoT products achieved significant growth, particularly in Europe where tech home appliances entered the market [5][16] Company Strategy and Development Direction - The company aims to solidify its high-end market position and expand premium sales in mature international markets [4] - Xiaomi plans to invest over CNY 40 billion in R&D for 2026, focusing on AI and embodied intelligence [7][10] - The strategy includes deep integration of AI across various product categories, enhancing user experience and operational efficiency [9][10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the second half of 2025 but expressed confidence in achieving growth targets for 2026 [12][44] - The company is prepared for potential impacts from rising memory prices and is focused on maintaining competitive pricing strategies [23][49] - Management emphasized the importance of innovation and product strength in navigating market challenges [57] Other Important Information - The company has committed to sustainable development, purchasing over 40 million kWh of green electricity in 2025 [20][21] - Xiaomi's ESG efforts were recognized with a B score in the CDP Climate Change and Water Security Survey [21] Q&A Session All Questions and Answers Question: Concerns about rising memory prices and their impact on smartphones - Management acknowledged the pressure from rising memory prices and indicated that while they aim to protect consumers from price hikes, adjustments may be necessary in the future [23][27][49] Question: Sales data for new generation vehicles - Management highlighted the success of the new generation vehicles, noting significant locked orders and a commitment to timely deliveries [31][32] Question: AI capabilities and commercialization - Management stated that while AI models are showing promise, commercialization is still in early stages, with ongoing improvements expected [54][56] Question: Impact of Middle Eastern situation on overseas business - Management indicated that the Middle Eastern market contributes only a small portion to overall revenue, and the situation remains controllable [48]

The Stock Exchange of Hong Kong Limited and the Securities and Futures Commission take no responsibility for the contents of this Application Proof, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Application Proof. Application Proof of Huaqin Co., Ltd. 華勤技術股份有限公司 (the "Company") (A joint stock company incorporated in the People's Republic of China w ...

You've seen it. You've probably done it. It's that single lean forward pose staring at our devices. It's ubiquitous across every environment we find ourselves in. at the airport, at the bus station, on the metro, waiting for the bus, at the restaurant, even at our own dining tables. It's our relentless obsession with our smartphones. I was sitting on the sidelines of my child's football game just a few weeks ago alongside other parents either side of me. Each of us with our foroding brick securely fastened ...