On August 12, Wavelength Opto-Electronic unveiled its semi-annual report for 2026, revealing that the company generated RMB 243 million in revenue during the first half of the year, marking a modest year-on-year uptick of 8.89%. The net profit attributable to the parent company skyrocketed by 102.65% to RMB 28.8468 million, whereas the net profit excluding non-recurring items reached RMB 24.2559 million, up 127.31% year-on-year.

Notably, the semi-annual report underscored a significant leap in the gross profit margin, which climbed 4.57 percentage points to 34.64% compared to the same period in the previous year. This enhancement mirrors the company's strategic endeavor to actively refine its business structure and concentrate on developing high-tech, high-barrier, and high-value-added products.

The company acknowledged that it has reaped the benefits of the explosive growth of artificial intelligence technology and its empowerment of downstream industries. Demand from customers in specific sectors, such as domestic semiconductor equipment, has surged. As a crucial component of this equipment, the company's precision optical components and assemblies have witnessed a substantial increase in market demand.

During the reporting period, the semiconductor and pan-semiconductor sectors contributed approximately RMB 35 million in revenue, with semiconductor product revenue reaching around RMB 18 million, registering an impressive year-on-year surge of 83%. Breaking it down by business segment, the laser optics sector generated RMB 145 million in revenue, infrared optics brought in RMB 77.3401 million, up 19.77% year-on-year, while consumer-grade optics contributed RMB 9.1834 million.

In terms of product categories, optical components generated RMB 116 million in revenue, up 29.35% year-on-year, with a gross profit margin of 34.30%. Optical assemblies brought in RMB 109 million, a 5.87% increase, with a gross profit margin of 35.37%. Optical system solutions, testing and design tools, and other revenues amounted to RMB 18.3411 million, a 40.53% decline, with a gross profit margin of 32.43%.

Regarding the contraction in this segment, the company primarily attributed it to phased fluctuations in project-based deliveries, noting that the subsequent recovery in the delivery pace warrants attention.

In addition to its outstanding profit performance, the company also demonstrated improvements in operational quality, as evidenced by its cash flow. The net cash flow generated from operating activities in the first half of the year turned sharply positive, reaching RMB 28.0767 million, compared to a negative RMB 2.3732 million in the same period last year, representing a year-on-year increase of 1283.08%. This was mainly due to a year-on-year decrease in cash outflows for purchased goods, indicating optimizations in the company's supply chain management and payment collection pace.

Furthermore, the company has been continuously engaged in researching and developing infrared chalcogenide glass materials as an alternative to germanium-containing materials in recent years, in line with the market demand for lightweight non-refrigerated infrared imaging. The 19.77% growth in the infrared optics business in the first half of the year indirectly confirms the potential commercial value of this material substitution route.

Currently, the company is deepening its 'Optics+' strategy, continuously expanding into emerging fields such as semiconductors, new energy vehicles, life sciences, and AR/VR. Wavelength Opto-Electronic's 'doubling performance' serves as a testament to the interim achievements of precision optics manufacturing enterprises in technological positioning and cost control. We eagerly anticipate its market performance in the second half of the year.