Recently, Rijiu Optoelectronics unveiled its semi-annual report for 2026, showcasing a revenue of RMB 320 million for the first half of the year, marking a 5.91% YoY increase. However, the net profit attributable to shareholders dipped by 23.77% YoY to RMB 34.7653 million. Excluding non-recurring items, the net profit attributable to shareholders stood at RMB 33.7469 million, a 23.54% YoY decrease.

From a quarterly viewpoint, the company’s performance has actually undergone a significant turnaround. In Q2 2026, the company achieved a revenue of RMB 192 million, up 17.46% YoY and 50.12% QoQ. The net profit attributable to shareholders soared to RMB 24.4030 million, up 38.99% YoY and 135.50% QoQ. Excluding non-recurring items, the net profit attributable to shareholders was RMB 23.8431 million, up 42.98% YoY.

The second quarter witnessed substantial YoY and QoQ growth in both revenue and profit, sharply contrasting with the overall “revenue growth without profit increase” trend in the first half of the year. This reflects a steady quarter-by-quarter improvement in the company’s operational quality.

In terms of revenue breakdown, the company’s main business encompasses three key segments: conductive film, optical film, and OCA optical adhesive, with each product line showing distinct performance trends.

Conductive film products remain the bedrock of the company’s revenue, generating RMB 206 million in the first half of the year, a 2.54% YoY decrease, accounting for 64.38% of total revenue, with a gross margin of 39.51%. Specifically, impacted by the shrinking demand in consumer electronics and the rising adoption of In-cell embedded touch technology, revenue from ITO conductive film dropped by 12.27% YoY.

Regarding light-adjusting conductive film, the company’s offerings have successfully penetrated the supply chains of several renowned automotive companies, with sales continuing to climb. However, to boost product adoption across a wider range of vehicle models and increase market penetration in the automotive sunroof sector, the company negotiated pricing strategy adjustments with major clients. Consequently, revenue from this product reached RMB 66.9577 million in the first half of the year, a 9.24% YoY decrease.

Optical film products emerged as the standout growth catalyst in this financial report, with the AR optical film series generating RMB 53.8377 million in revenue, marking a significant 110.29% YoY increase, and a gross margin as high as 42.27%, up 10.20 percentage points YoY. The company not only sustained growth in the automotive display sector but also made substantial breakthroughs in the consumer electronics segment, establishing a stable sales scale.

In contrast, OCA optical adhesive products generated RMB 48.4343 million in revenue in the first half of the year, a 13.52% YoY decrease, with a gross margin of -8.99%, still incurring losses.

On the expense front, the company’s total period expenses for the first half of 2026 amounted to RMB 54.6108 million, up RMB 11.2863 million from the same period last year, with the period expense ratio rising to 17.07%, a 2.73 percentage point YoY increase. Specifically, sales expenses rose by 23.37% YoY, administrative expenses by 21.97% YoY, and R&D expenses by 33.27% YoY, with R&D efforts concentrated on areas such as foldable OCA optical adhesive and curved OCA optical adhesive.

The substantial rise in expenses was one of the direct contributors to the decline in net profit. From a financial health standpoint, the company’s net cash flow from operating activities was RMB 63.5599 million, a 31.33% YoY decrease, primarily due to the increased scale of engineering equipment payments settled through bank acceptance bills endorsement.

However, the balance sheet revealed that the company’s total assets at the end of the reporting period were RMB 1.297 billion, with net assets attributable to shareholders of listed companies at RMB 1.136 billion, and an asset-liability ratio of only 12.40%, indicating a relatively solid financial structure and low debt repayment pressure.

Overall, Rijiu Optoelectronics is navigating a structural transformation amid adjustments to its existing business and expansion into new ventures, experiencing short-term profit pressures. Nevertheless, the long-term growth narrative still requires ongoing validation through subsequent performance. We eagerly anticipate its new market developments in the future.