CIG(SH:603083)2023-10-13 07:47Group 1: Company Overview - The company's revenue for the first half of 2023 was 1.74 billion, with a net profit of 156 million and a net cash flow from operating activities of 180 million [2] - The growth in high-speed optical modules and broadband access business was noted, while wireless access and JDM business remained stable or slightly declined [2] Group 2: Market Demand and Trends - The demand for 400G and 800G optical modules is expected to be significantly influenced by AI in 2024, potentially surpassing traditional data center demand [2] - The North American optical module market is anticipated to split into traditional data center demand and new demand driven by AI [2] - The growth in demand for 400G and 800G is primarily expected to come from supercomputing, as traditional data center demand remains relatively stable [3] Group 3: Supply Chain and Production Challenges - The supply of VCSEL laser devices is currently insufficient, impacting the transition from multimode to single-mode optical fibers for 800G applications [3] - The company anticipates that the actual shipment numbers may differ from market predictions due to uncertainties in the economic environment and inventory pressures [3] - The availability of new generation switch chips is crucial for the adoption of 800G technology, which may delay its market entry [3] Group 4: Competitive Landscape and Pricing - The company expects to capture a significant market share in the 800G segment, although competition is anticipated to increase as more companies enter the market [7] - The pricing pressure in the 800G market is expected to be significant, with raw material costs fluctuating and potentially impacting profit margins [7] - The company is focusing on silicon photonics and LPO technology, which are seen as advantageous for future product offerings [8] Group 5: International Operations and Currency Risk - Approximately 83% of the company's revenue comes from international markets, particularly North America and Europe, with expectations for continued growth [6] - The company has implemented measures to manage currency risk, including monitoring exchange rates and utilizing financial instruments for hedging [6]