Goldman Sachs stated in a research report that HUA HONG SEMI (01347) guided for first-quarter revenue to decline by 1% or remain flat sequentially, with a gross margin between 13% and 15%. This compares to the 13% gross margin achieved in the fourth quarter of 2025, indicating continued improvement driven by robust capacity utilization, rising average selling prices, and effective cost control. The midpoint of the revenue guidance was below the firm's and market expectations, while the midpoint of the gross margin guidance met the firm's projections and slightly exceeded market consensus. Goldman Sachs maintained a "Buy" rating and a target price of HK$134.

The company reported fourth-quarter 2025 revenue of $660 million, up 22% year-over-year and 4% sequentially, in line with its guidance. Gross margin stood at 13%, within the guided range of 12% to 14%, broadly meeting both the firm's and market expectations. Operating losses widened to $45 million, compared to a loss of $15 million in the previous quarter, which management attributed to increased labor costs. Non-operating items were largely in line with the firm's forecasts, but net profit came in at $17 million, below the firm's expectation of $43 million and the market consensus of $37 million.

Goldman Sachs remains positive on HUA HONG SEMI due to growth opportunities arising from AI applications, solid capacity utilization supported by demand recovery, and increasing demand from domestic customers amid localization trends, which are expected to drive long-term growth.