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Hua Hong Semiconductor Ltd. (HK:1347)
:1347
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Hua Hong Semiconductor Ltd. (1347) AI Stock Analysis

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HK:1347

Hua Hong Semiconductor Ltd.

(1347)

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Neutral 54 (OpenAI - 4o)
Rating:54Neutral
Price Target:
HK$90.00
▲(15.24% Upside)
Hua Hong Semiconductor Ltd. has a mixed outlook. The most significant factor is its financial performance, which is hampered by profitability and cash flow issues. Technical analysis shows some positive momentum, but valuation concerns due to a high P/E ratio and low dividend yield weigh heavily. The earnings call provided some optimism with record revenue and gross margin improvements, but the net loss and increased expenses are notable risks.
Positive Factors
Revenue Growth
The significant year-over-year revenue growth indicates strong market demand and effective sales strategies, positioning the company well for sustained expansion in the semiconductor industry.
Technological Advancements
Continuous technological advancements enhance Hua Hong's competitive edge, supporting long-term growth and adaptation in the rapidly evolving semiconductor market.
Strong Demand in Key Markets
Strong demand in China, a critical market, underscores Hua Hong's robust market position and potential for continued revenue growth as the region's semiconductor needs expand.
Negative Factors
Net Loss for the Period
The net loss indicates challenges in cost management and profitability, which could hinder financial stability and growth if not addressed.
Increased Operating Expenses
Rising operating expenses can pressure margins and profitability, necessitating efficiency improvements to sustain long-term financial health.
Cash Flow Challenges
Persistent cash flow issues limit Hua Hong's ability to invest in growth opportunities and maintain operational flexibility, impacting long-term viability.

Hua Hong Semiconductor Ltd. (1347) vs. iShares MSCI Hong Kong ETF (EWH)

Hua Hong Semiconductor Ltd. Business Overview & Revenue Model

Company DescriptionHua Hong Semiconductor Ltd. (1347) is a leading semiconductor foundry based in China, specializing in the manufacturing of integrated circuits (ICs) for a wide range of applications, including consumer electronics, automotive, and industrial sectors. The company focuses on advanced process technologies, offering a portfolio of services that includes wafer fabrication, design support, and technology transfer. With a commitment to innovation and quality, Hua Hong Semiconductor plays a pivotal role in the global supply chain for semiconductor components.
How the Company Makes MoneyHua Hong Semiconductor generates revenue primarily through its foundry services, which involve manufacturing custom silicon wafers for clients in various industries. The company's key revenue streams include the production of analog, mixed-signal, and power semiconductor devices, which are crucial for modern electronic products. Additionally, Hua Hong Semiconductor benefits from long-term contracts with major technology firms, providing a stable income base. The company also engages in partnerships with tech companies for joint development projects, enhancing its technological capabilities and market reach. Factors contributing to its earnings include the growing demand for semiconductors driven by trends like IoT, automotive electronics, and 5G technology, as well as its ability to maintain competitive pricing and high production efficiency.

Hua Hong Semiconductor Ltd. Earnings Call Summary

Earnings Call Date:Nov 06, 2025
(Q3-2025)
|
% Change Since: |
Next Earnings Date:Feb 10, 2026
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive and negative aspects. The company achieved record-breaking revenue and gross margin improvements. However, there was a net loss for the period, a significant decrease in other income, and increased operating expenses. Despite these challenges, the company showed strong demand in key markets and technological advancements.
Q3-2025 Updates
Positive Updates
Record-Breaking Revenue
Third quarter 2025 sales revenue for Hua Hong Semiconductor reached a record high of USD 635.2 million, a 20.7% increase over Q3 2024 and 12.2% over Q2 2025.
Gross Margin Improvement
Gross margin stood at 13.5%, 1.3 percentage points over Q3 2024 and 2.6 percentage points above Q2 2025.
Strong Demand in China
Revenue from China was $522.6 million, contributing 82.3% of total revenue and an increase of 20.3% compared to Q3 2024.
Growth in North America and Europe
Revenue from North America was $63.8 million, an increase of 36.7% compared to Q3 2024. Revenue from Europe increased by 12.6% compared to Q3 2024.
Technological Advancements
Advancements in process technology, R&D, and market development are contributing to improved profitability and a solid foundation for long-term sustainable development.
Negative Updates
Net Loss for the Period
Net loss for the period was $7.2 million compared to a profit of $22.9 million in Q3 2024.
Decrease in Other Income
Other income net was $70.8 million, 65.7% lower than Q3 2024, primarily due to decreased foreign exchange gains and interest income.
Increased Operating Expenses
Operating expenses were $100.4 million, 23.3% over Q3 2024, primarily due to increased engineered wafer costs and depreciation expenses.
Company Guidance
During Hua Hong Semiconductor's third quarter 2025 earnings call, the company provided guidance for the fourth quarter, anticipating revenue between $650 million and $660 million and a projected gross margin ranging from 12% to 14%. In Q3 2025, the company achieved record sales revenue of $635.2 million, marking a 20.7% year-over-year and 12.2% quarter-over-quarter increase. The gross margin was 13.5%, exceeding guidance and showing improvement due to enhanced capacity utilization and an increase in average selling prices by 5.2% quarter-on-quarter. Operating expenses rose to $100.4 million, with increases in engineered wafer costs and depreciation expenses. The net loss stood at $7.2 million, a decrease from a profit of $22.9 million in Q3 2024 and an improvement from a $32.8 million loss in Q2 2025. The company highlighted strategic capacity planning initiatives, including ongoing technology and capacity expansions, notably through their acquisition deal and the development of their Fab 9A. Additionally, Hua Hong is actively enhancing its core competencies to navigate the evolving semiconductor landscape.

Hua Hong Semiconductor Ltd. Financial Statement Overview

Summary
Hua Hong Semiconductor Ltd. faces challenges in profitability and cash flow management, despite a stable balance sheet. The company shows modest revenue growth but struggles with a negative EBIT margin and low net profit margin. The balance sheet is stable with manageable debt levels, but cash flow issues persist with negative free cash flow.
Income Statement
45
Neutral
Hua Hong Semiconductor Ltd. shows a mixed performance in its income statement. The TTM data indicates a modest revenue growth rate of 4.78%, but the company is struggling with profitability, as evidenced by a negative EBIT margin of -7.77%. The net profit margin is low at 2.90%, reflecting challenges in converting revenue into profit. Historical data shows declining gross profit margins and fluctuating revenue growth, indicating potential instability in revenue streams.
Balance Sheet
60
Neutral
The balance sheet presents a stable financial structure with a moderate debt-to-equity ratio of 0.36, suggesting manageable leverage. However, the return on equity is low at 0.47%, indicating limited efficiency in generating returns from equity. The equity ratio stands at 51.50%, showing a solid equity base relative to total assets, which is a positive sign of financial stability.
Cash Flow
40
Negative
Cash flow analysis reveals significant challenges, with negative free cash flow and a concerning free cash flow to net income ratio of -4.84. Although operating cash flow is positive, the coverage ratio of 0.35 suggests limited capacity to cover net income. The free cash flow growth rate is slightly positive at 5.30% TTM, but historical volatility in free cash flow growth indicates potential cash flow management issues.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.18B2.00B2.29B2.48B1.63B961.28M
Gross Profit237.38M205.13M487.10M843.66M451.60M234.79M
EBITDA498.43M385.01M774.51M993.26M627.56M255.40M
Net Income29.99M58.11M280.03M449.91M261.48M99.44M
Balance Sheet
Total Assets12.24B12.42B10.94B7.06B6.20B4.57B
Cash, Cash Equivalents and Short-Term Investments3.85B4.46B5.59B2.01B1.61B922.79M
Total Debt2.30B2.22B2.12B1.93B1.61B587.82M
Total Liabilities3.36B3.51B2.93B2.92B2.52B1.21B
Stockholders Equity6.30B6.25B6.30B3.03B2.87B2.53B
Cash Flow
Free Cash Flow-2.65B-2.32B-264.91M-245.32M-420.44M-818.15M
Operating Cash Flow548.13M459.50M641.70M750.87M518.47M269.11M
Investing Cash Flow-3.09B-2.67B-833.31M-930.16M-863.06M-405.66M
Financing Cash Flow-21.85M1.15B3.78B672.18M1.01B540.43M

Hua Hong Semiconductor Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price78.10
Price Trends
50DMA
69.21
Positive
100DMA
54.76
Positive
200DMA
43.44
Positive
Market Momentum
MACD
1.92
Positive
RSI
51.65
Neutral
STOCH
41.53
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HK:1347, the sentiment is Positive. The current price of 78.1 is below the 20-day moving average (MA) of 79.60, above the 50-day MA of 69.21, and above the 200-day MA of 43.44, indicating a neutral trend. The MACD of 1.92 indicates Positive momentum. The RSI at 51.65 is Neutral, neither overbought nor oversold. The STOCH value of 41.53 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HK:1347.

Hua Hong Semiconductor Ltd. Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
73
Outperform
$47.82B66.147.85%0.22%12.62%-4.75%
63
Neutral
HK$2.94B7.0717.96%6.34%-18.35%-6.00%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
61
Neutral
HK$1.19B23.194.98%-25.16%-51.97%
59
Neutral
$33.98B138.671.55%0.62%-0.64%-39.74%
54
Neutral
HK$155.90B629.570.12%0.21%19.15%-94.32%
46
Neutral
HK$99.48M-41.46%-26.02%-4977.27%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:1347
Hua Hong Semiconductor Ltd.
78.10
54.90
236.64%
HK:0522
ASMPT Ltd
82.35
8.90
12.12%
HK:1385
Shanghai Fudan Microelectronics Group Co
40.26
24.41
154.01%
HK:2878
Solomon Systech (International) Ltd.
0.48
-0.08
-14.29%
HK:8490
Niche-Tech Semiconductor Materials Limited
0.14
-0.05
-26.32%
HK:0085
China Electronics Huada Technology Company Limited
1.42
0.14
10.94%

Hua Hong Semiconductor Ltd. Corporate Events

Hua Hong Semiconductor Achieves Record Revenue Amidst Global Semiconductor Demand Recovery
Nov 6, 2025

Hua Hong Semiconductor reported a record revenue of $635.2 million for the third quarter of 2025, marking a 20.7% increase from the previous year. Despite a 42.6% decrease in net profit compared to the same quarter last year, the company showed significant quarter-on-quarter improvement. The company attributes its success to the recovery in global semiconductor demand and its efficient management practices. Hua Hong is also working on an acquisition to boost production capacity and diversify its process platform, aiming to enhance profitability and competitiveness in the global market.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$90.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Announces Board Composition
Oct 31, 2025

Hua Hong Semiconductor Ltd. has announced the composition of its board of directors, detailing the roles and functions of each member. This update provides clarity on the leadership structure and committee memberships, which is crucial for stakeholders to understand the governance and strategic direction of the company.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$90.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Announces Leadership Changes
Oct 31, 2025

Hua Hong Semiconductor Ltd. has announced significant leadership changes effective October 31, 2025. Mr. Peng Bai has been appointed as the new chairman of the board, chairman of the nomination committee, and authorized representative, succeeding Mr. Junjun Tang, who has resigned from these roles. The company believes that Mr. Bai’s combined role as chairman and president will enhance strategic execution and communication within the board.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$90.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor to Review Q3 Financials in Upcoming Board Meeting
Oct 23, 2025

Hua Hong Semiconductor Limited has announced that its board of directors will hold a meeting on November 6, 2025, to review and approve the company’s unaudited financial results for the third quarter of 2025. This meeting is crucial as it will provide insights into the company’s financial performance and potentially impact its market positioning and stakeholder confidence.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$90.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Updates on Major Acquisition and Fundraising Plans
Oct 16, 2025

Hua Hong Semiconductor Ltd. has announced a monthly update regarding its major and connected transaction, which includes a proposed acquisition and a non-public issuance of RMB shares to raise ancillary funds. The company is currently negotiating the terms of the acquisition and preparing necessary documentation, with a delay in the dispatch of the circular approved until December 31, 2025. The completion of these transactions is contingent upon certain conditions, including shareholder approval, and may not proceed if these conditions are not met.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$90.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Appoints Financial Adviser for Proposed Acquisition
Sep 19, 2025

Hua Hong Semiconductor Limited has appointed Innovax Capital Limited as the Hong Kong Independent Financial Adviser to guide the Independent Board Committee and shareholders on the fairness and reasonableness of a Proposed Acquisition and related mandates. This strategic move is expected to ensure informed decision-making for stakeholders and potentially strengthen the company’s market position.

The most recent analyst rating on (HK:1347) stock is a Buy with a HK$68.10 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Delays Circular Dispatch for Major Acquisition
Sep 19, 2025

Hua Hong Semiconductor Ltd. has announced a delay in the dispatch of a circular related to a major acquisition agreement and a proposed non-public issuance of RMB shares. The delay is due to the need for additional time to finalize terms and prepare necessary documentation, including an asset valuation report and pro-forma financial information. The company has applied for an extension to dispatch the circular by December 31, 2025, and further announcements will be made regarding the timing. The completion of these transactions is contingent upon certain conditions, including shareholder approvals, and may not proceed if these conditions are not met.

The most recent analyst rating on (HK:1347) stock is a Buy with a HK$68.10 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Ltd. Withholds Interim Dividend for H1 2025
Sep 5, 2025

Hua Hong Semiconductor Ltd. announced that its Board does not recommend the payment of an interim dividend for the six-month period ending June 30, 2025. This decision may impact stakeholders’ expectations regarding returns, but all other financial information remains unchanged from the previous announcement.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$40.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Announces Major Acquisition and Fundraising Plans
Aug 31, 2025

Hua Hong Semiconductor Ltd. has announced a major acquisition agreement to purchase 97.4988% of the share capital of a target company, with the remaining shares already owned by its subsidiary, HHGrace. This acquisition involves issuing consideration shares and a cash payment, with the final terms subject to further negotiations and appraisals. Additionally, the company plans a non-public issuance of RMB shares to raise supporting funds, contingent on regulatory approvals and completion of the acquisition. These strategic moves are expected to enhance Hua Hong’s market position and operational capabilities.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$40.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Releases 2025 Interim Results
Aug 28, 2025

Hua Hong Semiconductor Limited announced its unaudited consolidated interim results for the first half of 2025, complying with the Hong Kong Stock Exchange’s listing requirements. The interim report will be available to shareholders and on the company’s website, reflecting its commitment to transparency and regulatory compliance.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$40.00 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Schedules Board Meeting for Interim Results
Aug 18, 2025

Hua Hong Semiconductor Limited has announced that its board of directors will hold a meeting on August 28, 2025, to consider and approve the publication of the company’s unaudited interim results for the first half of 2025. This meeting is significant as it will provide insights into the company’s financial performance and could impact its market positioning and stakeholder interests.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$35.40 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Announces Trading Halt Amid Potential Acquisition
Aug 18, 2025

Hua Hong Semiconductor Ltd. announced a trading halt of its RMB shares on the Shanghai Stock Exchange’s STAR Board due to a potential acquisition of equity interests in Shanghai Huali Microelectronics Corporation. The trading halt, effective from August 18, 2025, is expected to last no more than 10 trading days, pending further announcements. The transaction is subject to various approvals and carries uncertainty regarding its implementation, urging investors to remain cautious.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$35.40 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

Hua Hong Semiconductor Reports Strong Q2 2025 Results Amidst Market Fluctuations
Aug 7, 2025

Hua Hong Semiconductor Limited reported its second quarter 2025 results, showing a revenue increase of 18.3% year-over-year to US$566.1 million and a net profit rise of 19.2% over the same period. The company achieved record capacity utilization and improved operational metrics amidst global trade fluctuations, while continuing to expand its product portfolio and ramp up its new 12-inch production line in Wuxi.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$35.40 price target. To see the full list of analyst forecasts on Hua Hong Semiconductor Ltd. stock, see the HK:1347 Stock Forecast page.

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.Date of analysis: Nov 06, 2025