This period represents one of the most robust growth phases for Hygon Information Technology Co.,Ltd. since its IPO, underscoring the explosive expansion underway in the domestic high-end processor market.
On Thursday evening, the company released its performance forecast for the first half of 2026. It anticipates achieving operating revenue between 8.5 billion and 9.3 billion yuan, representing year-over-year growth of 55.56% to 70.20%. Net profit attributable to shareholders is projected to be in the range of 1.7 billion to 1.83 billion yuan, an increase of 41.50% to 52.32%.
First-quarter revenue had already reached a record high of 4.034 billion yuan. Based on the forecast, second-quarter revenue is estimated to be approximately 4.466 billion to 5.266 billion yuan, indicating a continued acceleration in growth and the potential for another quarterly record. The mid-point of the first-half revenue forecast is around 8.9 billion yuan, a significant jump from 5.464 billion yuan in the same period last year, highlighting a rapid scaling of the company's overall operations.
Notably, if the impact of share-based payments is excluded, the adjusted net profit attributable to shareholders for the first half would reach 2.17 billion to 2.3 billion yuan, expanding the year-over-year growth rate to 74.27% to 84.71%. After excluding share-based payments, adjusted net profit after non-recurring items would be even higher, at 1.98 billion to 2.17 billion yuan, representing growth of 74.64% to 91.40%. These figures reveal that while share-based compensation expenses have a significant dilutive effect on reported net profit, the improvement in the company's core operational profitability far exceeds what the headline numbers suggest, indicating a very solid underlying profit quality.
Driven by its "CPU + DCU" dual-product strategy and benefiting from multiple tailwinds—including the accelerated iteration of large AI models, the scaled deployment of AI Agent applications, and the shift of domestic substitution from policy-driven to commercial adoption—Hygon Information Technology Co.,Ltd. is positioned at a critical juncture within a highly favorable industry cycle.
Revenue Acceleration Exceeds Expectations, Strong Growth Persists in Q2
First-quarter revenue of 4.034 billion yuan was already a historical high. Based on the first-half forecast mid-point of 8.9 billion yuan, second-quarter revenue is estimated at approximately 4.866 billion yuan, representing a sequential increase of over 20% from Q1, with the year-over-year growth rate also expected to remain above 55%.
This acceleration is underpinned by two clear drivers. First, downstream demand remains robust. Capital expenditure by major domestic internet companies, telecom operators, and state-owned enterprise data centers on AI infrastructure is entering a phase of intensive deployment, characterized by front-loaded orders and concentrated deliveries for DCU computing chips. Second, the competitiveness of Hygon's products continues to improve. Leveraging deep compatibility with the x86 ecosystem, the migration cost for customers replacing foreign products is relatively manageable, leading to increasing customer stickiness.
Share-Based Payments Depress Reported Profit, Underlying Profitability is Stronger
The forecasted net profit attributable to shareholders for the first half is 1.7 billion to 1.83 billion yuan (compared to 1.2 billion yuan a year ago), corresponding to a net profit margin of approximately 19% to 20%, which has narrowed compared to the prior year period.
The primary factor weighing on margins is a significant increase in share-based payment expenses. The adjusted net profit, excluding these expenses, is about 470 million yuan higher than the reported net profit. This indicates a substantial increase in the company's investment in incentivizing core talent—a necessary cost for a research-driven chip company to solidify its long-term competitiveness.
Looking at adjusted net profit after non-recurring items, the first-half range is 1.51 billion to 1.7 billion yuan, representing growth of 38.53% to 55.96%, also indicating a high growth trajectory. After further excluding share-based payments, this figure jumps to 1.98 billion to 2.17 billion yuan, with the highest year-over-year increase reaching 91.40%. This metric better reflects the cash-generating ability of the company's core operations.
Sustained High R&D Investment Builds a Technological Moat
The company's announcement explicitly states that the core driver of performance growth is "technological innovation and product performance enhancement" propelled by "high-intensity R&D investment."
For a chip company like Hygon Information Technology Co.,Ltd., whose core competitiveness lies in its proprietary architecture, R&D expenditure is both a major cost item impacting current profits and the most critical source of future growth.
From a product strategy perspective, Hygon continues to deepen the synergistic ecosystem of "CPU + DCU." On the CPU side, the focus is on domestic substitution in the server market. On the DCU side, the company is capitalizing on the window of opportunity created by the explosive demand for AI training and inference. As the performance of Hygon's next-generation DCU products continues to iterate and their adaptability in large model training clusters improves, the process of customers transitioning from "trial use" to "volume procurement" is accelerating.
Three Major Drivers Converge, Extending the Industry's Growth Cycle
In its announcement, the company attributes the strong performance growth to the convergence of three macro factors: the accelerated iteration of large AI models, the scaled deployment of AI Agent applications, and the progression of domestic substitution towards commercial application.
These factors are not independent but mutually reinforcing. The iteration of large models drives exponential expansion in computing power demand, while the deployment of AI Agents diffuses this demand from a few top-tier internet companies to a broader range of industry clients. Furthermore, the commercialization of domestic substitution means demand is no longer reliant on one-time, policy-driven procurement pulses but is forming a sustainable market-based purchasing logic, effectively extending the industry's favorable cycle.
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