Guobo Electronics has replied to the Shanghai Stock Exchange's annual report inquiry letter, explaining why 2025 revenue dropped 7.92 percent while gross margin rose by 3.5 percentage points and net profit attributable to the parent grew 4.72 percent. The company said the revenue decline was mainly due to the cyclical adjustment in the military electronics industry during the final year of the 14th Five-Year Plan, which delayed the order rhythm for T/R modules. The gross margin improvement was driven by higher usage of in-house developed chips. The share of wafers using self-developed chips for T/R modules rose from 17.76 percent in 2023 to 27.53 percent in 2025. At the same time, process optimization and strict procurement cost control reduced the unit cost of T/R modules and RF modules by 43.56 percent, outpacing the 40.05 percent decline in unit selling price, lifting the segment's gross margin from 39.10 percent to 42.66 percent. The gross margin of RF chips also increased by 4.69 percentage points due to a higher proportion of high-margin silicon-based gallium nitride products. The net profit increase was also helped by a reduction in asset impairment losses of 46.8456 million yuan in 2025 compared with the previous year. The company also explained that the high proportion of fourth-quarter revenue and the sharp decline in first-quarter 2026 performance are consistent with the seasonal characteristics of the military electronics industry, and there was no premature revenue recognition.
Guobo Electronics Co. Ltd. AHigher usage of in-house developed chips (from 17.76% to 27.53%) and process optimization improved gross margin despite revenue decline.