On August 22nd, AAC Tech (2018.HK) released its mid-term performance report for 2024. The Group's revenue for the first half of the year was RMB 11.25 billion, a year-on-year growth of 22.0%. The gross margin was 21.5%, an increase of 7.4 percentage points year-on-year. Net income was RMB 0.537 billion, a significant increase of 257.3% year-on-year, demonstrating a significant enhancement in profitability. The gross margin of various business lines continued to increase.
In the first half of 2024, the optical business revenue was RMB 2.21 billion, a year-on-year increase of 24.9%. The gross margin increased significantly by 21.7 percentage points compared to the same period last year, with the gross margin of plastic lenses increasing by 27.4 percentage points to 16.7% year-on-year, and the gross margin of optical modules increasing by 11.8 percentage points to 5.7% year-on-year. AAC Tech management stated that this is mainly due to the recovery of demand in the smart phone optical industry and the higher shipment volume and price improvement brought by the increase in market share in the mid-to-high-end segment.
In addition, the group's optical technology continues to upgrade, and the product structure is continuously optimized. In terms of plastic lenses, the high-end progress is smooth, with the shipment proportion of 6P lenses remaining above 15% and obtaining the fixed-point project of 7P plastic lenses. In terms of optical modules, benefiting from the steady increase in shipments and prices, the revenue in the first half of the year increased by 29% year-on-year.
The widely concerned glass-plastic hybrid lens area, AAC Tech's WLG single set mold capacity has increased several times, and the efficiency of WLG glass lens production has been greatly improved and stably delivered. In the first half of the year, AAC Tech shipped approximately 1.4 million units of high-spec 1G6P (1 piece of WLG glass lens and 6 pieces of plastic lens combination) glass-plastic hybrid lenses, an increase of nearly 40% year-on-year. The recently released Xiaomi MIX Fold 4 also used the 1G6P WLG glass-plastic hybrid lens to create a "super-translucent" visual experience for users.
According to incomplete statistics from the media, AAC Tech's WLG lenses have been adopted by many mid-to-high-end models such as Redmi K50 Supreme Edition, Sony Xperia pro-I, Xiaomi Civi3, Xiaomi MIX Fold 3, with the latter two models adopting the 1G6P WLG glass-plastic hybrid lens solution.
AAC Tech management stated that WLG (wafer-level glass) technology is unique to AAC Tech and can significantly enhance the performance of optical products. It is more efficient than traditional glass lens production processes, and can meet higher precision requirements and have more flexible structural options. It also has the unique advantage of integrated die-casting, which can greatly improve the production efficiency and precision of micro prisms. In order to meet customers' innovation demands for main cameras, telephotos, and prisms, AAC Tech is actively cooperating with customers on more high-end and flagship project research. At the same time, the group attaches importance to inventory management, improves operational efficiency and product yield, further optimizes unit costs, and achieves a significant increase in gross margin.