tiprankstipranks
Trending News
More News >
Hua Hong Semiconductor Ltd. (HK:1347)
:1347

Hua Hong Semiconductor Ltd. (1347) AI Stock Analysis

Compare
33 Followers

Top Page

HK:1347

Hua Hong Semiconductor Ltd.

(1347)

Select Model
Select Model
Select Model
Neutral 54 (OpenAI - 5.2)
Rating:54Neutral
Price Target:
HK$125.00
▲(7.30% Upside)
The score is driven primarily by mixed financial performance: strong revenue growth and a stable balance sheet are outweighed by weak profitability and negative free cash flow. Technicals show a strong uptrend but very overbought conditions raise near-term risk. Valuation is a major headwind due to an extremely high P/E, while the latest earnings call was moderately supportive with improving margins and constructive guidance despite a net loss and higher costs.
Positive Factors
Revenue Growth
Sustained double-digit revenue growth and a record quarter indicate strong structural demand across China, North America and Europe. Higher volumes support better capacity utilization and provide scale to fund R&D and fabs, improving long-term competitiveness and market share.
Gross Margin Improvement
Improving gross margins driven by higher capacity utilization and a 5.2% quarter-on-quarter ASP uplift point to operational leverage. As technology upgrades and Fab 9A capacity come online, margin expansion can be durable if utilization and product mix improvements persist.
Moderate Leverage / Solid Equity Base
A moderate debt-to-equity ratio and ~51% equity base provide financial flexibility to fund capital-intensive fabs and technology investments without extreme leverage. This balance sheet strength helps absorb cyclical swings and supports multi-quarter expansion plans.
Negative Factors
Negative Free Cash Flow
Persistently negative and worsening free cash flow undermines the firm's ability to self-fund heavy capex for fabs and R&D. Given semiconductor capital intensity, weak FCF increases reliance on external financing and raises execution risk over the next several quarters.
Weak Profitability
Negative EBIT and near-breakeven net margin despite strong revenue growth show the company struggles to convert sales into operating profits. This limits ROE improvement and reinvestment capacity, leaving margin recovery and efficiency gains critical for durable returns.
Rising Operating Costs and Falling Other Income
A sharp decline in non-operating income plus operating expenses up 23.3% (engineered wafer costs, depreciation) means earnings are more exposed to core operating trends. With ongoing capacity buildouts, higher fixed costs could structurally compress margins absent sustained ASP gains.

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

Hua Hong Semiconductor Ltd. Business Overview & Revenue Model

Company DescriptionHua Hong Semiconductor Limited, an investment holding company, manufactures and sells semiconductor products. The company provides embedded non-volatile memory, standard logic and mixed-signal, radio frequency, power management integrated circuits, power discrete, and automotive solutions. It also offers foundry services; and design services comprising standard and customized IP development, full-custom layout design, and customer-specific integrated solutions, as well as design support and tape out services. In addition, the company provides multi-project wafer services; mask making services; and backend services, such as in-house testing, backside processing and dicing, and backend turnkey services, as well as wafer probing, assembly, and testing. Its products are used in consumer electronics, communications, computing, industrial, and automotive markets in the People's Republic of China, North America, Europe, Japan, and other Asian countries. The company was founded in 1997 and is headquartered in Shanghai, the People's Republic of China. Hua Hong Semiconductor Limited is a subsidiary of Shanghai Alliance Investment Ltd.
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
Strong top-line growth is offset by weak profitability and cash generation. Income statement shows very high revenue growth but negative EBIT margin and thin net margin. Balance sheet is stable with moderate leverage, but ROE is very low. Cash flow is pressured by negative and declining free cash flow despite operating cash flow exceeding net income.
Income Statement
55
Neutral
Hua Hong Semiconductor Ltd. shows a mixed performance in its income statement. The TTM data indicates a significant revenue growth of 204.26%, which is a positive sign. However, the company struggles with profitability, as evidenced by negative EBIT margins (-5.65%) and a low net profit margin of 1.37%. The gross profit margin is also relatively low at 10.87%. The company needs to improve its operational efficiency to enhance profitability.
Balance Sheet
65
Positive
The balance sheet reflects a stable financial position with a reasonable debt-to-equity ratio of 0.38, indicating moderate leverage. The equity ratio stands at 50.87%, suggesting a solid equity base. However, the return on equity is low at 0.48%, indicating that the company is not generating significant returns on its equity. Improving profitability could enhance ROE.
Cash Flow
45
Neutral
The cash flow statement reveals challenges, particularly with free cash flow, which is negative and declining. The operating cash flow to net income ratio is healthy at 1.34, indicating good cash generation relative to net income. However, the free cash flow to net income ratio is concerning at -2.18, highlighting issues in converting earnings into free cash flow. The company needs to address its cash flow management to ensure long-term sustainability.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.30B2.00B2.29B2.48B1.63B961.28M
Gross Profit309.83M205.13M487.10M843.66M451.60M234.79M
EBITDA390.59M385.01M774.51M993.26M627.56M255.40M
Net Income10.03M58.11M280.03M449.91M261.48M99.44M
Balance Sheet
Total Assets12.29B12.42B10.94B7.06B6.20B4.57B
Cash, Cash Equivalents and Short-Term Investments3.95B4.46B5.59B2.01B1.61B922.79M
Total Debt2.41B2.22B2.12B1.93B1.61B587.82M
Total Liabilities3.49B3.51B2.93B2.92B2.52B1.21B
Stockholders Equity6.25B6.25B6.30B3.03B2.87B2.53B
Cash Flow
Free Cash Flow-3.41B-2.32B-264.91M-245.32M-420.44M-818.15M
Operating Cash Flow2.12B459.50M641.70M750.87M518.47M269.11M
Investing Cash Flow-5.48B-2.67B-833.31M-930.16M-863.06M-405.66M
Financing Cash Flow-76.74M1.15B3.78B672.18M1.01B540.43M

Hua Hong Semiconductor Ltd. Technical Analysis

Technical Analysis Sentiment
Positive
Last Price116.50
Price Trends
50DMA
84.51
Positive
100DMA
78.43
Positive
200DMA
58.04
Positive
Market Momentum
MACD
10.04
Negative
RSI
71.50
Negative
STOCH
80.88
Negative
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 116.5 is above the 20-day moving average (MA) of 101.55, above the 50-day MA of 84.51, and above the 200-day MA of 58.04, indicating a bullish trend. The MACD of 10.04 indicates Negative momentum. The RSI at 71.50 is Negative, neither overbought nor oversold. The STOCH value of 80.88 is Negative, 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
66
Neutral
HK$63.34B79.797.85%0.20%12.62%-4.75%
64
Neutral
HK$2.76B6.7317.96%6.98%-18.35%-6.00%
62
Neutral
HK$43.38B176.971.55%0.69%-0.64%-39.74%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
56
Neutral
HK$1.09B21.014.98%-25.16%-51.97%
54
Neutral
HK$226.01B3,883.330.12%0.23%19.15%-94.32%
41
Neutral
HK$85.37M-1.13-41.46%-26.02%-4977.27%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
HK:1347
Hua Hong Semiconductor Ltd.
116.50
93.65
409.85%
HK:0522
ASMPT Ltd
103.90
31.25
43.01%
HK:1385
Shanghai Fudan Microelectronics Group Co
52.00
37.55
259.76%
HK:2878
Solomon Systech (International) Ltd.
0.44
-0.03
-6.45%
HK:8490
Niche-Tech Semiconductor Materials Limited
0.12
-0.04
-24.38%
HK:0085
China Electronics Huada Technology Company Limited
1.36
0.19
16.24%

Hua Hong Semiconductor Ltd. Corporate Events

Hua Hong Semiconductor Sets February Board Meeting to Review Q4 2025 Results
Jan 29, 2026

Hua Hong Semiconductor Limited has scheduled a board meeting for 12 February 2026 to review and approve the publication of its unaudited financial results for the fourth quarter of 2025, covering the period from 1 October to 31 December 2025. The meeting will also address any other board business, signaling the company’s routine financial disclosure process and offering investors and stakeholders an upcoming checkpoint on its recent operating performance.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$113.00 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 Calls EGM on Share-Financed Asset Acquisition and Fund-Raising Plan
Jan 21, 2026

Hua Hong Semiconductor Limited has called an extraordinary general meeting for 10 February 2026 in hybrid format in Shanghai and online, where shareholders will vote on a series of ordinary resolutions related to the company’s plan to issue renminbi-denominated shares to acquire specified target assets and to raise supporting funds. The proposals include approving the issuance of RMB shares in lieu of a previously envisaged mix of cash and shares as consideration, detailed terms for the asset purchase and accompanying fund-raising, lock-up and impairment compensation arrangements, use of proceeds, and the required approvals from independent shareholders under Hong Kong listing and takeover rules, with the transaction mandate intended to remain valid for 12 months if passed; if endorsed, the package would facilitate a share-financed expansion of Hua Hong’s asset base while deepening its presence in China’s domestic capital markets and reshaping its capital structure through related party and connected transactions.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$109.00 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 Sends Circular on Major Acquisition, RMB Share Issuance and Whitewash Waiver
Jan 21, 2026

Hua Hong Semiconductor has dispatched a circular to shareholders detailing a proposed major and connected transaction to acquire the share capital of a target company through the issue of consideration shares under a specific mandate, alongside a proposed non-public issuance of RMB shares to raise supporting funds. The circular also outlines applications for a whitewash waiver and consent for a special deal, as well as independent recommendations and valuation reports, ahead of an extraordinary general meeting scheduled for 10 February 2026 in Shanghai, where independent shareholders will vote on the acquisition, the share issuance, and the related waivers and consents. The company cautioned that completion of the acquisition and the RMB share issuance remains subject to multiple regulatory and shareholder approvals, including the granting of the whitewash waiver and consent to the special deal by the relevant executive authority, underscoring that the transaction may or may not proceed and advising investors to exercise caution when dealing in its securities.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$109.00 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 Sets February EGM on Acquisition and RMB Share Issuance
Jan 20, 2026

Hua Hong Semiconductor Limited has scheduled an extraordinary general meeting (EGM) for 10 February 2026 to seek shareholder approval for a proposed acquisition, a non-public issuance of RMB-denominated shares, a specific mandate, a whitewash waiver and a special deal, all of which could significantly reshape its capital structure and ownership profile. The company will close its register of members from 5 to 10 February 2026 to determine voting entitlements, and it cautioned that completion of the transaction package remains uncertain, as it is subject to multiple regulatory approvals, the grant of a whitewash waiver and consent to the special deal, as well as high voting thresholds from independent shareholders, underscoring execution risk for investors and stakeholders tracking its strategic expansion plans.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$109.00 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 Sets Terms for Major Acquisition and RMB Share Issue
Dec 31, 2025

Hua Hong Semiconductor has set the final consideration for its previously announced acquisition of a target company at RMB8.48 billion, to be paid through the issuance of 190,768,392 new consideration shares plus minor cash for fractional shares, after agreeing the valuation with the vendors via a supplemental agreement. The company also entered into a compensation arrangement with its controlling shareholder Huahong Group under which any asset impairment in the acquired business over the next three financial years will trigger compensation to Hua Hong Semiconductor, partly via repurchase of consideration shares at a nominal price and partly in cash, and it plans to raise up to RMB7.56 billion through a non‑public issuance of RMB shares—amounting to no more than 30% of enlarged share capital—to fund the deal, subject to regulatory and independent shareholder approvals at an upcoming extraordinary general meeting, where investors will also vote on related mandates, a whitewash waiver and treatment of the issuance as a special deal under takeover rules.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$68.00 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 Renews Connected Transactions and Sets New Lease Caps for 2026
Dec 30, 2025

Hua Hong Semiconductor has renewed a series of continuing connected transactions with affiliated parties for 2026, including a framework agreement with Huahong Group for mutual sales and purchases of semiconductor products and materials, a property management agreement and dormitory lease with Huajin Property Management and Huahong Real Estate, and a clean room lease with Huali Micro. The board has also proposed new annual caps for long-term leases with Huali Micro and Huahong Real Estate, which run until 2030 and 2033 respectively, to ensure the company can continue using and providing key facilities in the ordinary course of business, supporting operational continuity and clarifying the scale of related-party dealings for investors and regulators.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$68.00 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
Dec 16, 2025

Hua Hong Semiconductor Ltd. has announced ongoing negotiations related to a major acquisition and a proposed non-public issuance of RMB shares to raise ancillary funds. The completion of these transactions is contingent upon certain conditions, including shareholder approvals and regulatory waivers, which may affect the company’s strategic positioning and financial structure.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$70.00 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
Nov 16, 2025

Hua Hong Semiconductor Ltd. has announced ongoing negotiations regarding a major acquisition and a proposed non-public issuance of RMB shares to raise ancillary funds. The company is preparing detailed financial information and reports to be included in a forthcoming circular, with further updates to be provided as necessary. The completion of these transactions is contingent upon certain conditions, including shareholder approvals and regulatory waivers, which may impact the company’s strategic positioning and stakeholder interests.

The most recent analyst rating on (HK:1347) stock is a Hold with a HK$75.00 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 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.

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: Jan 29, 2026