Hua Hong Semiconductor (1347) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue reached $566.1 million, up 18.3% year-over-year and 4.6% sequentially, driven by increased wafer shipments and robust demand.

• Gross margin was 10.9%, up 0.4 percentage points year-over-year and 1.7 points sequentially, aided by improved capacity utilization.

• Net loss narrowed to $32.8 million from $41.7 million a year ago and $52.2 million in Q1 2025.

• Net profit attributable to shareholders was $8.0 million, up 19.2% year-over-year and 112.1% sequentially.

• Capacity utilization hit a recent record high, with 12-inch lines ramping up and Fab 9 contributing to sales.

Financial highlights

• Operating expenses were $97.9 million, up 8.4% year-over-year, mainly due to higher labor, engineering wafer, and depreciation costs.

• Other income net was $10.6 million, up 54% year-over-year, driven by lower FX losses, finance costs, and higher subsidies.

• Net cash flow from operations was $169.6 million, up 75.1% year-over-year and 238% sequentially.

• Cash and cash equivalents stood at $3,846.9 million at quarter-end.

• CapEx for the quarter was $407.7 million, mainly for new fab capacity.

Outlook and guidance

• Q3 2025 revenue is projected at $620–$640 million, with gross margin expected between 10% and 12%.

• Gross margin is expected to remain stable in Q4, supported by price adjustments and cost reductions, offset by higher depreciation.

• The company aims to leverage specialty process advantages, accelerate capacity expansion, and strengthen supply chain management.