Core Viewpoint - The storage industry leader, Baiwei Storage, has shown strong interest from over a hundred institutions during its recent investor relations activities, indicating a positive outlook for the company and the industry as a whole [1] Industry Overview - The storage industry is experiencing a price recovery, with companies like SanDisk, Longsys, and Micron issuing price increase notices for their products. The supply-demand imbalance in NAND has significantly improved due to production cuts and inventory reduction [1] - In the DRAM sector, major players like Samsung, Micron, and Hynix are focusing on high-end products, leading to a reduction in supply for DDR4 and Mobile LPDDR4X, resulting in a supply shortage and price increases [1] - The overall market sentiment remains positive, supported by seasonal demand and emerging applications such as AI glasses [1] Company Performance - Baiwei Storage reported a revenue of 3.912 billion yuan for the first half of 2025, marking a year-on-year increase of 13.7% and a quarter-on-quarter growth of 53.5% in Q2. The sales gross margin increased by 11.7 percentage points in Q2, reaching 18.61% in June [2] - The company's performance is attributed to its expansion among leading domestic and international clients across various sectors, including mobile, PC, enterprise, and smart wearables [3] Client Base and Market Position - In the mobile sector, Baiwei's embedded storage products are utilized by major clients such as OPPO, vivo, and Motorola. In the PC sector, its SSD products are supplied to Lenovo, Xiaomi, and HP [3] - The company is a key supplier in the domestic PC market and is rapidly growing in the enterprise sector, having secured core supplier qualifications from AI server manufacturers and leading internet companies [3] - In the smart automotive sector, Baiwei has delivered LPDDR and eMMC products to major automotive manufacturers, enhancing its product offerings for various applications [3] AI and Product Development - Baiwei Storage has a strong competitive edge in AI edge storage, with self-developed main control chips and firmware algorithms. The company expects over 1 billion yuan in revenue from AI emerging sectors in 2024, a year-on-year growth of approximately 294% [4] - The first domestically developed eMMC main control chip (SP1800) has been successfully mass-produced, with plans for a UFS main control chip (SP9300) to enhance competitiveness in high-end storage solutions [4] Advanced Packaging Capabilities - The company is advancing its wafer-level packaging capabilities, with construction completed for its manufacturing facility, set to begin production in the second half of 2025. This will enhance its offerings in integrated storage and computing solutions [5] - Baiwei has developed various advanced packaging technologies, enabling it to meet the growing demand for large-capacity storage solutions in AI, smart driving, and server applications [5] Future Outlook - With the recent price increases in storage and the growth in AI edge applications, Baiwei Storage's performance is expected to improve. Analysts predict significant net profit growth rates of 193.22%, 55.61%, and 33.56% for the years 2023, 2024, and 2027, respectively [5]