0054 GMT - Hua Hong Semiconductor's gross margin in the low-teens is likely to persist in 2026, says DBS Group Research's Jim Au in a note. The Chinese semiconductor manufacturer's expansion is driving higher depreciation and operating expenses, he says. Labor costs could also be a near-term headwind. The analyst flags that the artificial-intelligence-driven memory tightness could continue through 2026, which might delay some consumer-electronics refresh cycles. However, Hua Hong's growth areas such as AI and green energy could outweigh any softness. DBS raises its target price to HK$88.00 from HK$75.00 but maintains a hold rating on the company's likely subpar margins. Hong Kong-listed shares last closed 1.2% higher at HK$99.90. (megan.cheah@wsj.com)

(END) Dow Jones Newswires

February 18, 2026 19:54 ET (00:54 GMT)

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