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AAC Technologies (AACAY)
OTHER OTC:AACAY
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AAC Technologies
(OTC:AACAY)
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Rating:67Neutral
Price Target:
$5.50
▲(10.66% Upside)
AAC Technologies' overall stock score reflects strong financial performance and positive earnings call insights, offset by bearish technical indicators and moderate valuation. The company's strategic focus on growth sectors like automotive and AI, alongside robust revenue and profit growth, supports a positive outlook. However, technical analysis suggests caution due to current bearish momentum.
Positive Factors
Revenue Growth
AAC Technologies' strong revenue growth of 18.4% YoY indicates robust demand for its products, driven by increased market share and strategic expansion, particularly in optics and automotive sectors. This growth trend supports long-term business sustainability and market competitiveness.
Optics Business Expansion
The expansion in the optics business, with a 19.7% YoY revenue increase, highlights AAC's successful innovation and market penetration in high-value segments. This growth strengthens its competitive position and enhances profitability through improved gross margins.
Automotive Acoustics Growth
The automotive acoustics segment's 14.2% revenue growth reflects AAC's strategic focus on diversifying and strengthening its product offerings in emerging markets. This positions the company well for sustained growth as the automotive industry increasingly integrates advanced acoustics.
Negative Factors
Gross Profit Margin Pressure
The decline in gross profit margins in the acoustics segment, due to new product ramp-up, suggests potential short-term challenges in cost management. This could impact overall profitability if not addressed, although stabilization is expected by year-end.
Microphone Margin Decline
The decline in microphone gross profit margins, attributed to lower margins of outsourced MEMS microphones, indicates a need for improved cost efficiency. This margin pressure could affect the profitability of AAC's MEMS segment if not mitigated.
Initial Yield Challenges
Challenges with initial yields for new acoustics products indicate potential inefficiencies in production processes. This can lead to increased costs and reduced margins, impacting long-term profitability unless production efficiencies are improved.
AAC Technologies (AACAY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$5.84B
Dividend Yield0.62%
Average Volume (3M)659.00
Price to Earnings (P/E)19.5
Beta (1Y)1.17
Revenue Growth31.23%
EPS Growth90.72%
CountryUS
Employees37,273
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)0.11
Shares Outstanding1,198,500,000
10 Day Avg. Volume1,480
30 Day Avg. Volume659
Financial Highlights & Ratios
PEG Ratio0.15
Price to Book (P/B)1.79
Price to Sales (P/S)1.49
P/FCF Ratio13.86
Enterprise Value/Market Cap7.88
Enterprise Value/Revenue1.57
Enterprise Value/Gross Profit7.22
Enterprise Value/Ebitda9.24
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusHold
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
AAC Technologies Business Overview & Revenue Model
Company DescriptionAAC Technologies Holdings Inc., an investment holding company, provides solutions for smart devices in Mainland China, Hong Kong Special Administrative Region of the People's Republic of China, Taiwan, other Asian countries, the United States, and Europe. It operates through Acoustics Product, Electromagnetic Drives and Precision Mechanics, Optics Products, and Micro Electro-Mechanical System (MEMS) Components segments. The Acoustics Product segment provides acoustics products for smartphone and automotive, as well as wearables, tablets, and notebook markets. The Electromagnetic Drives and Precision Mechanics segment manufactures and sells haptic motors that are used in smartphones, smart watches, tablets, intelligent automobiles, smart glasses, game controllers, virtual reality/augmented reality (AR) controllers, and bone conduction headphones. This segment also offers precision mechanics comprising metal casing, bottom and parts for tablets, wearables, and notebooks products. The Optics Products segment provides plastic, front-view, surround-view, and occupant monitoring system and driver monitoring system vehicle lenses; camera modules; and voice coil motor and optical image stabilizer solutions. The MEMS Business segment offers MEMS microphone products for true wireless stereo earphones, smart speakers, tablets, and automotive markets. The company also offers research and development services; manufactures and sells tooling and precision components, electronic components, and related accessories; and provides electroplating services. AAC Technologies Holdings Inc. has a strategic partnership with Dispelix for providing AR and mixed reality solutions. The company was formerly known as AAC Acoustic Technologies Holdings Inc. and changed its name to AAC Technologies Holdings Inc. in May 2011. AAC Technologies Holdings Inc. was founded in 1993 and is headquartered in Shenzhen, the People's Republic of China.
How the Company Makes MoneyAAC Technologies generates revenue through the sale of its acoustic and optical components to major smartphone manufacturers and consumer electronics brands. The company primarily earns money by supplying high-performance audio components that enhance sound quality and user interaction in devices. Key revenue streams include the sale of miniature speakers, microphones, and haptic feedback devices, as well as optical products like camera modules. Strategic partnerships with leading technology companies and manufacturers bolster its market position, allowing AAC to secure long-term contracts and collaborations that stabilize and grow its revenue base. Additionally, AAC Technologies benefits from ongoing demand in the growing segments of IoT devices and smart technology, which further diversifies its earnings sources.
AAC Technologies Earnings Call Summary
Earnings Call Date:Aug 21, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Mar 19, 2026
Earnings Call Sentiment Positive
The earnings call presented a strong overall performance with significant revenue and net profit growth driven by the optics and automotive acoustics segments. Despite some challenges with gross profit margins in the acoustics and microphone segments, the company remains confident in future improvements. The expansion of the heat dissipation business and strategic acquisitions in the automotive sector support a positive outlook.Q2-2025 Updates
Positive Updates
Strong Revenue Growth
The Group's revenue reached CNY13.32 billion, representing a rapid YoY increase of 18.4%, driven by increased market share of key products.
Significant Net Profit Increase
Net profit increased by 63.1% YoY to CNY876 million, largely due to improved profitability in the optics business and growth in high-gross-profit businesses.
Optics Business Growth
The optics business continued its rapid growth with revenue reaching CNY2.65 billion, a YoY increase of 19.7%, and a gross profit margin improvement of 5.5 percentage points YoY.
Automotive Acoustics Performance
Automotive acoustics business generated revenue of CNY1.74 billion, a YoY increase of 14.2%, with a gross profit margin of 23.9% and strategic acquisitions enhancing capabilities.
Heat Dissipation Business Expansion
The heat dissipation segment saw revenue reach CNY221 million in the first half of the year, representing a YoY increase of over 45%, with significant investments and expected growth.
EMD and PM Business Growth
Revenue increased by 27.4% YoY to CNY4.63 billion, maintaining a gross profit margin of 22.9%, with new product innovations driving growth.
Negative Updates
Gross Profit Margin Decline in Acoustics
Gross profit margin for the acoustics segment saw a slight decline due to the ramp-up of new products, although it is expected to stabilize by year-end.
Pressure on Microphone Gross Profit Margins
While microphone revenue grew significantly, gross profit margins declined due to new product ramp-up and the lower margins of outsourced MEMS microphones.
Challenges with Initial Yields
Initial yields for new products in the acoustics segment were not high, affecting gross profit margins in the first half of the year.
Company Guidance
The 2025 Interim Results Announcement Conference for AAC Technologies provided significant guidance on the company's financial performance and strategic outlook. For the first half of 2025, the company's revenue reached CNY13.32 billion, marking an 18.4% year-over-year increase, while the gross profit was CNY2.75 billion with a gross profit margin of 20.7%. Net profit surged by 63.1% year-over-year to CNY876 million. The optics business achieved a gross profit margin improvement of 5.5 percentage points year-over-year, with a notable rise in plastic lenses' gross profit margin by over 10 percentage points. The automotive acoustics business reported a 14.2% revenue increase to CNY1.74 billion, with a gross profit margin of 23.9%. Cash inflow stood at CNY2.89 billion, reflecting a 9.1% year-over-year increase, and free cash flow was CNY1.86 billion. Capital expenditure increased by 57.5% year-over-year to CNY1.44 billion. The company expressed confidence in maintaining a high revenue growth rate of at least 18.4% in the second half of the year, with gross profit margins projected to remain stable or improve, driven by the launch of high-value products. AAC Technologies highlighted its strategic focus on expanding in the automotive sector, enhancing its optics and acoustics capabilities, and leveraging AI trends to drive future growth.AAC Technologies Financial Statement Overview
Summary
AAC Technologies presents a solid financial performance with strong revenue and profit growth, supported by efficient operations and a stable balance sheet. The company maintains a healthy cash flow, enabling it to fund its operations and growth initiatives effectively. While leverage is moderate, careful management of debt levels will be crucial to sustaining financial stability.Income Statement
AAC Technologies has shown strong revenue growth, with a significant increase of 33.8% from 2023 to 2024. The gross profit margin is robust at 22.1% and the net profit margin improved to 6.6% in 2024, indicating efficient cost management and profitability. The EBIT and EBITDA margins are healthy, standing at 8.4% and 20.3% respectively, showcasing operational efficiency. However, EBIT margin could be improved further to enhance profitability.Balance Sheet
The company's balance sheet reflects a sound financial position, with a debt-to-equity ratio of 0.46, indicating moderate leverage. The return on equity (ROE) is commendable at 7.9%, suggesting effective use of shareholders' capital. The equity ratio stands at 48.7%, showing a balanced capital structure. Although the company maintains a solid equity base, the relatively high total debt requires careful monitoring to avoid financial strain.Cash Flow
AAC Technologies demonstrates a strong cash flow position with a free cash flow of 2.9 billion in 2024, marking a recovery from previous years. The operating cash flow to net income ratio is positive, indicating good cash generation relative to profits. The free cash flow to net income ratio is 1.63, showing adequate cash coverage for net income. The company has consistently improved its cash flow generation, but continued focus on capital expenditure efficiency will be beneficial.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 29.40B | 27.33B | 20.42B | 20.63B | 17.67B | 17.14B |
| Gross Profit | 6.38B | 6.04B | 3.45B | 3.78B | 4.36B | 4.23B |
| EBITDA | 4.98B | 5.55B | 4.18B | 4.25B | 4.02B | 3.65B |
| Net Income | 2.14B | 1.80B | 740.37M | 821.30M | 1.32B | 1.51B |
Balance Sheet | ||||||
| Total Assets | 47.03B | 46.70B | 38.91B | 40.34B | 42.02B | 38.91B |
| Cash, Cash Equivalents and Short-Term Investments | 7.76B | 7.54B | 6.83B | 7.15B | 6.05B | 7.54B |
| Total Debt | 11.12B | 10.45B | 9.58B | 10.42B | 10.50B | 9.21B |
| Total Liabilities | 23.27B | 23.58B | 16.54B | 18.15B | 19.52B | 17.09B |
| Stockholders Equity | 23.29B | 22.75B | 21.88B | 21.66B | 21.81B | 21.16B |
Cash Flow | ||||||
| Free Cash Flow | 2.14B | 2.93B | 3.09B | 2.45B | -1.17B | -656.62M |
| Operating Cash Flow | 4.17B | 5.20B | 4.63B | 4.37B | 2.18B | 3.59B |
| Investing Cash Flow | -2.50B | -3.49B | -1.51B | -2.35B | -4.25B | -3.26B |
| Financing Cash Flow | -1.71B | -1.02B | -3.17B | -1.44B | 632.55M | 2.58B |
AAC Technologies Technical Analysis
Negative
4.97
Price Trends
4.99
Negative
5.32
Negative
5.19
Negative
Market Momentum
0.03
Negative
47.94
Neutral
51.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AACAY, the sentiment is Negative. The current price of 4.97 is below the 20-day moving average (MA) of 4.98, below the 50-day MA of 4.99, and below the 200-day MA of 5.19, indicating a bearish trend. The MACD of 0.03 indicates Negative momentum. The RSI at 47.94 is Neutral, neither overbought nor oversold. The STOCH value of 51.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AACAY.
AAC Technologies Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
69 Neutral | $4.52B | 20.26 | 18.41% | 0.17% | 13.42% | 31.28% | |
67 Neutral | $5.84B | 19.49 | 9.39% | 0.62% | 31.23% | 90.72% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $24.69B | 232.81 | 13.42% | ― | 33.62% | ― | |
60 Neutral | $3.94B | -141.67 | ― | ― | 9.86% | 99.11% | |
59 Neutral | $2.12B | 249.61 | 17.08% | ― | 14.31% | ― | |
58 Neutral | $6.28B | -477.16 | -7.49% | ― | 4.24% | -141.83% |
* Technology Sector Average
AACAY
AAC Technologies
4.97
0.44
9.74%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.