WSMC posts strong Q2 profit, forecasts 11-13% revenue growth in Q3

GaAs chip manufacturer WSMC (3105) announced strong second-quarter financial results, reporting a net profit of 977 million yuan. This marks a significant turnaround from the same period last year, where the company experienced losses, and represents an 83.3% increase compared to the first quarter of 2026. The company's earnings per share (EPS) for the second quarter stood at 2.3 yuan, bringing the cumulative EPS for the first half of the year to 3.56 yuan.

Revenue for the second quarter reached 5.257 billion yuan, showing a 14.5% increase from the previous quarter and a substantial 39% year-on-year growth. The company's gross margin improved to 28.2%, up 1.9 percentage points from the first quarter. WSMC attributed this performance to a favorable product mix, with demand strengthening in mobile power amplifiers (PA) and significant growth in infrastructure applications driven by data centers and aerospace satellite sectors. Optical communication products also began contributing to revenue as they entered mass production after completing verification.

Looking ahead to the third quarter, WSMC anticipates continued growth, projecting a revenue increase of 11-13% compared to the second quarter. The gross margin is expected to be between 31% and 33%. While acknowledging potential uncertainties in the mobile phone market due to memory shortages and price increases, WSMC remains optimistic about demand for high-end devices, particularly focusing on mid-to-high-end Android phones and the Apple iOS market.

WSMC also highlighted its success in extending its GaAs pHEMT and GaN technologies into low-orbit satellite and space communication applications, solidifying its position in the global aerospace radio frequency component market. Furthermore, the company has entered the AI high-speed and massive optical communication transmission fields, which are expected to drive future revenue.