GigaDevice reported revenue of 4.188 billion yuan in the first quarter, representing a year-on-year increase of 119%; net profit reached 1.461 billion yuan, up by 523% year-on-year. The primary drivers were rising volumes and prices of memory chips, alongside strong demand for microcontrollers across multiple sectors. Gross margin improved significantly, expense ratios declined across the board, and non-GAAP net profit surged by 530%, demonstrating solid core business performance. The company’s H-share listing boosted cash holdings substantially, reducing the debt-to-asset ratio to 8.13%, while operating cash flow increased by 431%.
On April 29, $GIGADEVICE (03986.HK)$ the company released its financial report for the first quarter of 2026. During the reporting period, the company achieved operating revenue of 4.188 billion yuan, representing a year-on-year increase of 119.38%; net profit attributable to shareholders of the listed company was 1.461 billion yuan, marking a year-on-year increase of 522.79%, with the growth rate of net profit significantly outpacing that of operating revenue. The non-recurring net profit amounted to 1.410 billion yuan, reflecting a year-on-year surge of 529.90%.
The company attributed its explosive performance to the synergistic efforts of its two major business lines: memory chip products faced a situation of supply falling short of demand, achieving both volume and price increases; microcontroller products benefited from strong demand across multiple sectors including industry, consumer electronics, and automotive, leading to a significant increase in shipments.
In terms of profitability, basic earnings per share increased from 0.35 yuan in the same period last year to 2.19 yuan; return on equity (ROE) rose from 1.41% to 6.12%, an increase of 4.71 percentage points. Net cash flow generated from operating activities was 1.783 billion yuan, a year-on-year increase of 430.91%. Sales receipts and net procurement expenditures saw substantial growth, reflecting a simultaneous improvement in cash flow quality.
Gross margin significantly improved, with expense ratios fully diluted
In the first quarter, the company's operating costs were 1.798 billion yuan, a year-on-year increase of 50.53%, much lower than the revenue growth rate of 119.38%, resulting in a significant improvement in gross margin. Taxes and surcharges amounted to 21.13 million yuan, a year-on-year increase of 87.33%, growing in tandem with the expansion of revenue scale.
On the expense side, despite a doubling of revenue, all expense ratios were reduced. R&D expenses were 358 million yuan, a year-on-year increase of 22.91%, but their proportion of revenue decreased from 15.27% in the same period last year to 8.56%; sales expenses were 134 million yuan, a year-on-year increase of 19.91%, with their share dropping from 5.85% to 3.20%; administrative expenses were 174 million yuan, a year-on-year increase of 27.81%, with their share decreasing from 7.14% to 4.16%. Financial expenses were 96.52 million yuan, compared to net income of 80.86 million yuan in the same period last year, mainly due to the impact of exchange rate fluctuations.
Total non-recurring gains and losses amounted to approximately 51.18 million yuan, accounting for about 3.5% of net profit, with limited impact. Among these, changes in fair value and disposal gains of financial assets were approximately 42.06 million yuan, and government subsidies totaled around 14.37 million yuan. Non-GAAP net profit was 1.41 billion yuan, a year-on-year increase of 529.90%, nearly matching the growth rate of net profit attributable to shareholders, indicating that the performance growth was primarily driven by core operations.
Balance Sheet: H-share listing boosts significant increase in net assets
On the asset side, total assets at the end of the first quarter were 27.774 billion yuan, a 29.80% increase from the beginning of the year. Of this, cash and cash equivalents amounted to 14.694 billion yuan, a 59.94% increase from the beginning of the year, mainly due to the completion of the H-share listing and the arrival of raised funds.
Inventory was 3.401 billion yuan, a 10.94% increase from the beginning of the year, consistent with the expansion of business scale. Trading financial assets were 414 million yuan, a 307.15% increase from the beginning of the year.
On the liability side, the total scale of liabilities amounted to 2.259 billion yuan, with the asset-liability ratio decreasing from 10.16% at the beginning of the year to 8.13%. The financial structure remained highly robust. Short-term borrowings stood at 200 million yuan, compared to zero at the end of the previous year; accounts payable reached 991 million yuan, representing a 21.86% increase from the beginning of the year.
Net assets attributable to shareholders of the listed company amounted to 25.273 billion yuan, reflecting a 32.96% increase from the beginning of the year, primarily driven by the capital raised from the H-share listing and an increase in net profit.
Operating cash flow surged significantly, with concurrent active investment and financing activities.
In the first quarter, net cash flow from operating activities amounted to 1.783 billion yuan, compared to 336 million yuan in the same period last year, marking a year-on-year increase of 430.91%. Among this, cash received from sales of goods and provision of services totaled 4.427 billion yuan, a year-on-year growth of 129.86%, which was generally in line with the revenue growth rate.
Regarding investment activities, net outflow amounted to 1.077 billion yuan, compared to a net outflow of 722 million yuan in the same period last year. Specifically, cash paid for the acquisition of fixed assets, intangible assets, and other long-term assets was 327 million yuan, reflecting a year-on-year increase of 47.87%; cash paid for investments reached 768 million yuan, compared to 20 million yuan in the same period last year.
Concerning financing activities, net inflow amounted to 4.374 billion yuan, compared to a net outflow of 26.93 million yuan in the same period last year, mainly due to a substantial increase in cash received from investments following the H-share listing.
Editor/Lambor