Hua Hong Grace Semiconductor Limited reported an all-time-high revenue of US$717.50 million for the quarter ended 30 June 2026, up 26.8% year-on-year and 8.6% sequentially. Robust wafer shipment growth (+17.9% YoY, +5.8% QoQ to 1.54 million 8-inch-equivalent units) and firmer average selling prices underpinned the top-line advance.
Gross margin expanded to 16.5%, an improvement of 5.6 percentage points over the prior-year period and 3.5 points versus Q1 2026, reflecting cost controls and pricing gains that offset higher depreciation. Operating expenses rose 11.4% YoY to US$109.08 million, chiefly on higher labour costs, while other income fell 79.4% to US$2.19 million on increased finance expenses and lower government subsidies.
Net profit attributable to shareholders surged to US$38.64 million, a 385.9% YoY increase and 84.6% higher than the previous quarter. Net profit margin improved to 0.5% from –5.8% a year earlier.
Operational highlights • Capacity utilisation averaged 102.8%, up 3.1 percentage points from Q1. • Embedded non-volatile memory (NVM) and standalone NVM led growth, with revenues climbing 41.8% and 149.3% YoY, respectively. • 12-inch wafers contributed 62.1% of revenue, rising 33.5% YoY to US$445.73 million, while 8-inch wafers added US$271.81 million (+17.0%). • China remained the largest market at 78.6% of sales (US$563.70 million), followed by North America (US$93.84 million, +77.0% YoY). • By end-market, consumer electronics accounted for 67.1% of revenue, growing 34.7% YoY; industrial & automotive rose 25.5% to US$162.07 million. • Advanced nodes (≤65 nm) generated US$205.07 million, up 63.4% YoY, driven by flash and PMIC demand.
Cash flow and balance sheet Operating cash flow nearly doubled YoY to US$338.05 million, supported by higher customer receipts. Capital expenditure reached US$356.57 million, predominantly for 12-inch capacity. Net cash used in financing totalled US$405.96 million after US$569.0 million in bank repayments exceeded new borrowings. Cash and cash equivalents stood at US$4.53 billion as of 30 June 2026, with a current ratio of 2.0x and a debt ratio of 36.3%.
Guidance for Q3 2026 Management targets revenue between US$770 million and US$780 million and projects a gross margin of 16%–18%.
Strategic update The company highlighted benefits from the AI-driven semiconductor demand rebound and confirmed regulatory approval for its planned acquisition of Huali Microelectronics, expected to bolster technology breadth and economies of scale.