STAR Market Integrated Circuit Firms Report Q1 Results: Domestic Substitution and Demand Recovery Drive Sustained High Growth

Translated from Securities Daily

(Securities Daily) (Reporter Tian Peng) As of May 9, over 110 integrated circuit companies listed on the STAR Market have disclosed their first-quarter reports. Collectively, they achieved total revenue of RMB 72.182 billion, marking a 24% year-on-year increase, while net profit attributable to shareholders reached RMB 4.479 billion, surging 73% year-on-year.

Overall, with the gradual recovery of downstream demand in AI, IoT, consumption, and pan-industrial applications, the integrated circuit industry saw significant growth in both revenue and profit. Building on the momentum from Q4 2024, companies in chip design, semiconductor equipment, and wafer manufacturing delivered outstanding performances.

Leading firms show clear positive trends in operations

According to the Q1 reports, the chip product segment posted remarkable earnings growth, with companies specializing in general-purpose chips (such as server and CPU chips) and optical chips recording particularly rapid expansion.

In Q1 2025, over 70 chip product companies collectively generated RMB 30.969 billion in revenue, up 24% year-on-year, with more than 70% reporting revenue growth. Net profit attributable to shareholders for these firms totaled RMB 2.056 billion, soaring 126% year-on-year, with over half achieving profit growth.

Consumer chips continued their strong recovery, with both revenue and net profit showing positive year-on-year growth. Eleven companies, including Telink Semiconductor (Shanghai) Co., Ltd., doubled their profits.

Among them, leading companies in System-on-Chip (SoC) and display driver chips, as well as some companies specializing in power management chips, delivered particularly outstanding performances. For example, Smartsens Technology (Shanghai) Co., Ltd. saw explosive growth in smartphone CMOS image sensors, with Q1 revenue reaching RMB 1.750 billion (up 108.94% year-on-year) and net profit attributable to shareholders of RMB 191 million (up 1,264.97% year-on-year).

Bestechnic (Shanghai) Co., Ltd. benefited from sustained growth in the smart wearable device market and government subsidies stimulating consumer demand. Its Q1 revenue hit RMB 995 million (up 52.25% year-on-year and 25.88% quarter-on-quarter), setting a new quarterly record. Net profit attributable to shareholders rose to RMB 191 million (up 590.22% year-on-year and 11.18% quarter-on-quarter).

Driven by AI computing power, companies producing general-purpose chips (such as server and CPU chips) and optical chips also exhibited rapid growth.

Montage Technology Co., Ltd. capitalized on the AI-driven demand for DDR5 memory interface chips and high-performance capacity chips, achieving revenue and net profit growth of 66% and 135% year-on-year, respectively.

Optical chip manufacturer Henan Shijia Photons Technology Co., Ltd. reported revenue and net profit growth of 121% and 1,004% year-on-year, thanks to mass production breakthroughs for multiple products and capacity ramp-up at its overseas factory in Thailand.

In Q1 2025, Hygon Information Technology Co., Ltd. saw rapid iteration of its DCU products and gained customer recognition, achieving growth in both revenue and net profit. Its contract liabilities reached a record high of RMB 3.237 billion by the end of the period, bolstering confidence in full-year performance.

Production capacity and orders send positive signals

Benefiting from the continued trend of localized production and demand recovery in consumption, automotive, and other sectors, four STAR Market-listed wafer foundries, including Semiconductor Manufacturing International Corporation (SMIC) and Hua Hong Semiconductor Limited, maintained high capacity utilization rates, achieving robust production and sales.

SMIC's capacity utilization rate approached 90%, and its Q1 net profit rose 166.5% year-on-year to RMB 1.365 billion. Co-CEO Zhao Haijun noted during the Q1 report conference call that positive signals of recovery were observed across industries, including manufacturing and automotive sectors, and the shift toward localized production remained strong, with more wafer fabrication demand returning to domestic suppliers.

Two companies specializing in specialty process wafer manufacturing also continued their recovery trend from 2024. For instance, Nexchip Semiconductor Corporation reported Q1 revenue of RMB 2.568 billion (up 15.25% year-on-year) and net profit attributable to shareholders of RMB 135 million (up 70.92% year-on-year), driven by growing demand for OLED displays.

The rapid global adoption of new energy vehicles and surging demand for automotive-grade power devices and sensors accelerated the profitability of United Nova Technology Co., Ltd. The company reduced its losses by 24.71% year-on-year in Q1, with revenue from automotive power modules more than doubling. The company now can supply approximately 70% of the automotive chips for new energy vehicles, with its automotive-grade IGBT/SiC MOSFET packaging technology reaching internationally leading levels.

In the upstream wafer manufacturing segment, semiconductor equipment companies also saw accelerated revenue growth. Data shows that over 10 STAR Market-listed semiconductor equipment firms collectively achieved revenue of RMB 7.807 billion, up 31% year-on-year despite a high base from the previous year, with over 80% reporting revenue growth.

Equipment companies also ramped up R&D efforts to support long-term industry development. Skyverse Technology Co., Ltd. accelerated the development of prototypes for high-end semiconductor inspection equipment, with Q1 R&D intensity reaching an industry-leading 41%. The company's bright/dark field defect inspection equipment has been consistently shipped to leading industry clients.

The above information is provided for reference purposes only and does not constitute investment advice.