Research Brief | Huadian Electronics Receives 11 Institutions Including Panzhun Investment; Net Profit of 3.822 Billion in 2025 with 47.74% YoY Growth

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Shangshi Electronics Co., Ltd. (hereinafter referred to as “Shu Dian Co., Ltd.”) hosted an on-site research visit on March 12, 2026, with 11 institutions including Shanghai Panking Investment, Beijing Ruigu Investment, Boli Heng Assets, and others. Company executives engaged in in-depth discussions with institutional investors on key issues such as 2025 operating performance, core business layout, capital expenditure plans, and progress of overseas factories.

Basic Information of Investor Activities

2025 Performance: Driven by AI and High-Speed Network Demand for Revenue and Profit Growth

During the research, the company disclosed that its 2025 operating data showed that benefiting from strong demand for artificial intelligence (AI) and high-speed network infrastructure, combined with balanced product layout and advantages in mass production technology of mid-to-high-end products, the company achieved approximately 18.9 billion yuan in operating revenue, a year-on-year increase of 42%; net profit attributable to shareholders of the listed company was about 3.822 billion yuan, up 47.74%; net profit after deducting non-recurring gains and losses was about 3.761 billion yuan, up 47.69%. The company specifically notes that these financial figures are preliminary calculations, audited by internal audit departments but not yet audited by an accounting firm, with final data subject to the 2025 annual report.

From the product structure perspective, high-speed network switches and related routing products remain the company’s core business, followed by AI servers and high-performance computing (HPC) related printed circuit boards (PCBs), both of which jointly drive performance growth.

Business Strategy: Focus on High-Barrier Fields, Adhere to Differentiation and Long-termism

The company states that it has long-term deep cultivation in high-tech barrier fields such as high-speed network switches and routers, AI servers and HPC, general servers, wireless communication networks, and smart vehicles, as well as high-growth PCB fields. In data communication, products are widely used in large-scale data centers, cloud service provider data centers, enterprise communication networks, and other scenarios; in smart vehicles, they provide hardware support for core devices such as autonomous driving domain controllers, intelligent driving systems, and smart cockpits.

In terms of business strategy, the company adheres to a differentiation route, dynamically aligning technological capabilities, process capabilities, and capacity structure with medium- and long-term market demands, focusing on leading customers. The company emphasizes prioritizing sustainable long-term benefits over short-term gains, balancing customer structure, technological innovation, and supply chain resilience to build competitive advantages. Technologically, the company focuses on core PCB technologies such as high multi-layer, high-frequency high-speed, high-density interconnects, and high-throughput, laying out fundamental R&D directions like signal integrity, power integrity, and system integration to cope with industry technological iterations.

Capital Expenditure and Industry Competition: Accelerate High-end Capacity Deployment to Meet Growing Demand

In response to increasing demand driven by AI servers, data storage, and high-speed network infrastructure, the company has accelerated capital expenditure in recent years. In the first three quarters of 2025, cash paid for the purchase of fixed assets, intangible assets, and other long-term assets was about 2.104 billion yuan; in Q4 2024, the company planned to invest approximately 4.3 billion yuan in a new high-end PCB project supporting AI chips, with a construction period of two years. Additionally, the wholly owned subsidiary Kunshan Huli Microelectronics Co., Ltd. plans to purchase land and buildings to establish new PCB production projects and supporting facilities.

The company admits that in 2025, more industry peers are shifting towards high-end PCB fields, intensifying competition. To address this, the company will allocate resources reasonably, upgrade technology (such as developing higher-density interconnects and faster transmission performance), and respond quickly to market demands to seize opportunities and strengthen its “base” business.

Thailand Factory: Certification by Leading Customers Signals Operational Turning Point in Q4

The Shangshi Thailand manufacturing base entered small-scale mass production in Q2 2025, with an annual loss of about 139 million yuan. However, the facility has obtained certification from top global customers in AI servers and switches, gaining formal supply qualifications, marking the initial formation of the company’s global delivery system.

The company reveals that the Thailand factory is actively improving production efficiency and product quality. As customer expansion and product integration progress, capacity will be gradually released. From the sequential data of Q4 2025, its operational situation has turned a corner, with significant increases in output scale, optimized product structure, and simultaneous improvements in production quality and operational efficiency.

New Technology Incubation: Layout of CoWoP and Optical-Copper Integration to Build R&D Closed Loop

The company plans to establish a wholly owned subsidiary in Jintan District, Changzhou, to build an incubation platform for cutting-edge technologies such as CoWoP and advanced processes like mSAP, creating a “R&D - Pilot - Verification - Application” closed-loop system. It aims to develop next-generation technologies like optical-copper integration to enhance signal transmission, power distribution, and functional integration capabilities. Once the technology and processes mature, the company will invest in large-scale production lines for high-density optoelectronic integrated circuit boards.

The company notes that this project involves frontier technology R&D, which may face long R&D cycles, high technical difficulty, and complex processes, with risks including deviations in technical routes, inability to break through key processes, or underperformance in commercialization. The company will conduct careful planning to reduce R&D risks and strive to achieve expected benefits.

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