Shares of ZJ INNOLIGHT (03308) tumbled in both A-share and H-share markets following the release of its financial results. As of the time of writing, the A-share price dropped more than 7%, while the H-share price fell 11.05% to HK$1014, with a trading turnover of HK$831 million.

On the news front, ZJ INNOLIGHT announced its first-half results, reporting total revenue of RMB 41.778 billion, a year-on-year surge of 182.49%, and net profit attributable to shareholders of listed companies of RMB 13.651 billion, up 241.7% year-on-year. It is noted that in the first quarter of this year, the company recorded a net profit of RMB 5.735 billion; based on this, the second-quarter net profit reached RMB 7.916 billion, representing a sequential growth of 38%.

During an institutional conference call on August 23, ZJ INNOLIGHT stated that its major customers have already provided guidance and orders for 2027, with demand for 1.6T and 800G products in 2027 still expected to grow rapidly compared to 2026. The company aims to maintain a high gross margin level and hopes to achieve a slight increase, noting that a substantial improvement would not align with industry dynamics.

Additionally, the company is expanding multiple production facilities, which led to increased capital expenditure in the second quarter. Management expects capital spending to remain significant through next year.