Desay SV half-year report reveals impact of memory price surge

Earnings

โดย 21世纪经济·

Summary · why it matters

Desay SV's share price tumbled 5.63% after it released its half-year report, its biggest one-day drop in nearly a month, dragging down other intelligent driving-related stocks such as Bethel Automotive Safety Systems, NavInfo, Jingwei Hirain, Hesai, and RoboSense. In the first half of the year, the company posted revenue of 14.901 billion yuan, up 1.75% year on year; net profit attributable to the parent was 1.245 billion yuan, up 1.81% year on year; and net profit attributable to the parent after deducting non-recurring items was 1.225 billion yuan, up 6.32% year on year, showing a clear loss of momentum. The single-digit profit growth relied almost entirely on proactive cost control, with selling expenses down 26.55% year on year and R&D investment down 9.30% year on year. The company's operating cash flow in the first half plunged to 1.062 billion yuan from 1.638 billion yuan in the same period last year, a year-on-year decline of 35.10%, while cash and cash equivalents fell to 895 million yuan from 1.448 billion yuan at the start of the year. The company attributed this mainly to higher spending on raw material stockpiling, namely prepayments and capacity lock-up expenditures to cope with rising memory prices. Gross margin for the first half was 19.08%, down 1.25 percentage points from the same period last year, while operating costs rose 3.35% year on year, nearly double the pace of revenue growth. By the end of the first half, contract liabilities reached 1.92 billion yuan, an increase of about 915 million yuan from the end of last year, which the company attributed to higher customer prepayments. Contract liabilities had once reached 2.563 billion yuan at the end of the first quarter before partially retreating in the second quarter, reflecting customers making concentrated prepayments to lock in memory costs, after which the company in turn paid prepayments to memory chip makers to lock in production capacity. Media reports said that from March to June this year, overall prices of automotive-grade memory chips rose by about 180%. Samsung, SK Hynix, and Micron control roughly 80% of global memory production capacity and have shifted 70% to 80% of their advanced capacity to AI server products such as HBM and DDR5, causing automotive-grade memory capacity to shrink sharply and delivery lead times to stretch to 24 to 30 weeks. Some research reports noted that the cost share of automotive-grade memory in domain controllers has surged from about 20% to 40% to 50%. Data from the China Passenger Car Association showed that in the first five months of 2026, the profit margin of China's auto industry was only 3.4%, far below the 6.1% average for downstream industrial enterprises.

Huizhou Desay SV Automotive Co Ltd Class A ▼