Lih-Ji sees heat dissipation product revenue soar over 300% year-on-year in May, eyes acquisition

Materials distributor Lih-Ji (3444) announced strong performance in May, with its heat dissipation products experiencing a substantial year-over-year revenue surge. The company's heat sink products, in particular, reached a historic high in monthly revenue, fueled by robust demand from the artificial intelligence (AI) server and high-performance computing (HPC) sectors.

Overall, Lih-Ji's consolidated revenue for May was NT$106 million, a slight decrease of 5% from the previous month but roughly on par with the same period last year. For the first five months of the year, cumulative revenue reached NT$535 million, marking a 2% increase compared to the previous year. Despite minor fluctuations in monthly revenue due to short-term supply chain adjustments, the company maintains a positive outlook, citing a steady growth trend.

The company highlighted that heat sink products saw a remarkable 315% increase in revenue compared to the previous year and a 15% rise from the previous month, becoming its primary growth engine. Lih-Ji is focusing on developing larger-sized heat sinks, aiming for these advanced products to constitute 50% of its shipments by mid-year to optimize its product profit structure.

Additionally, Lih-Ji is actively expanding its business through strategic investments. The company recently signed an agreement to acquire a controlling stake in Ming Chun Yuan, a heat sink manufacturer. Upon completion of the acquisition in July, Lih-Ji's stake will increase from 6% to 82%, allowing for full consolidation of Ming Chun Yuan's profits into its financial statements. This move is expected to enhance Lih-Ji's vertical integration capabilities, accelerate new product development, and better capture the burgeoning market opportunities in AI and HPC cooling solutions. Ming Chun Yuan also supplies SSD casings to Kioxia, which will further diversify Lih-Ji's product portfolio and global market reach.