LINGYI ITECH (01688) released its interim results for the first half of 2026 on the evening of August 28, revealing a new all-time high in revenue. The company achieved operating income of RMB 25.149 billion during the period, representing a year-on-year increase of 6.45%, marking the tenth consecutive quarter of positive revenue growth. Net profit attributable to shareholders reached RMB 764 million, down 17.88% from the prior corresponding period.

Gross profit for the first half of 2026 climbed to RMB 4.206 billion, a record high and a substantial 18.07% improvement year-on-year. The gross margin expanded to 16.73%, an increase of 1.65 percentage points compared with the same period last year. According to the announcement, the company’s research and development expenditure totalled RMB 1.442 billion in the first six months of 2026, up 27.86% year-on-year. These funds were primarily directed towards new project development for AI terminal applications, with particular emphasis on foldable screen hardware, vapour chamber cooling components, server liquid cooling systems, server power supplies, and embodied intelligent robotics.

From a revenue composition perspective, the company’s AI hardware-related business generated approximately RMB 20.464 billion, accounting for 81.37% of total revenue. Within this segment, battery and power supply products (including both device-side and AI server power units) contributed RMB 3.928 billion, a year-on-year increase of 12.73%. Thermal management solutions (covering device-side and AI server cooling) brought in RMB 2.920 billion, surging 43.46% from the previous year. The automotive and low-altitude economy business delivered revenue of RMB 3.528 billion, an impressive 198.26% growth, while its gross margin improved by approximately 6.25 percentage points year-on-year.

Device-Side AI Business: Multi-Product Iteration with Foldable Screens and Thermal Management Achieving Volume Delivery

The industry regards 2026 as the inaugural year for foldable phones without visible creases. In response, LINGYI ITECH has deepened its expertise across various advanced materials and precision manufacturing processes to meet the performance, lightweight, and durability requirements of foldable terminal devices. During the reporting period, the company supplied core precision components for a new-generation foldable device to its major North American customer, encompassing hinge precision structures, screen support plates, ultra-thin vapour chambers, and flanged ultra-thin stainless steel battery casing modules.

In the thermal management arena, the company offers integrated cooling solutions for global leading technology clients, ranging from vapour chambers (VC) made of multiple materials to comprehensive AI terminal thermal systems. Its product matrix of stainless steel, composite materials, aviation-grade titanium, and 3D dual-heat-source multi-form vapour chambers continues to evolve. During the period, high-performance vapour chambers entered mass production, and the delivery volume of mid-frame integrated vapour chambers grew steadily. Notably, the company’s flagship product—the 3D dual-heat-source vapour chamber—has been adopted in flagship models from leading domestic manufacturers, capable of dissipating heat for both system-on-chip components and camera modules.

In the first half of the year, revenue from XR wearable devices reached RMB 1.794 billion, up 17.72% year-on-year. The company provides comprehensive coverage of soft functional components, injection-moulded parts, thermal solutions, and chargers for AR, VR, MR, and AI glasses, collaborating closely with terminal brands to establish itself as a leading supplier of core hardware and key technologies for smart wearable devices.

Physical AI and AIDC Computing Power Businesses Achieve Mass Production Milestones; Two New Tracks Enter Volume Delivery Phase

Positioning AI data centre (AIDC) computing hardware as its second growth curve, the company completed the acquisition of Readore in January 2026, thereby strengthening its server liquid cooling hardware capabilities. Readore specialises in quick-disconnect connectors (UQD), liquid cooling manifolds, single-phase liquid cooling modules (including server cold plates and optical module cold plates), phase-change cooling modules, server vapour chambers (VC and 3DVC), and busbars. As a core supplier to a leading North American computing power customer, Readore continues to deliver server liquid cooling and power supply products in volume to leading overseas computing enterprises and ecosystem partners.

Additionally, the subsidiary Salcomp has commenced mass production and shipment of Common Redundant Power Supplies (CRPS) for servers, completing a fully integrated product portfolio that combines liquid cooling and power supply capabilities. In the physical AI (humanoid robotics) sector, the company is executing a three-pronged embodied intelligence strategy centred on core component R&D, comprehensive hardware manufacturing services, and industrial scenario deployment, with the ambition of becoming one of the global top three embodied intelligence hardware manufacturers. During the reporting period, manufacturing bases in Beijing, Chengdu, Zhengzhou, and overseas locations were gradually brought online, with mass production and delivery of humanoid robot core components, joint modules, and complete units now underway, enhancing the company’s industry influence.

To date, the company has completed assembly services for thousands of hardware units and complete robots for multiple leading embodied intelligence enterprises, providing application development and full-machine assembly support for various robot models. Among these, the "Lightning" robot from Honor, which clinched the championship at the 2026 Beijing Yizhuang Humanoid Robot Half Marathon, utilises core structural components and surface treatment services supplied by the company. Beyond serving external clients, the company has also upgraded its internal industrial applications of embodied intelligence, deploying multiple types of industrial robots in key production processes such as material loading and unloading, AOI inspection, and CNC machining. In CNC line operations, automated pallet and tool changes, IPQC sampling inspections, and dimensional checks have achieved overall labour savings of 40%, while AOI inspection has reduced comprehensive retrofit costs by 30% to 50%.

On June 26, 2026, the company was listed on the Main Board of the Hong Kong Stock Exchange, formally establishing a dual A+H capital platform. The proceeds from this listing are primarily earmarked for expanding server liquid cooling capacity, upgrading humanoid robot manufacturing bases, and advancing cutting-edge precision process R&D. In terms of shareholder returns, the company continues to implement dividend distributions and share buyback initiatives. A cash dividend of RMB 145 million was distributed for the 2025 fiscal year, and an interim dividend of RMB 162 million has been proposed for the first half of 2026. Regarding buybacks, as of June 30, the company had repurchased RMB 311 million of its A-shares, subsequently raising its A-share repurchase ceiling to RMB 4.8 billion. By July 31, 2026, cumulative repurchases had reached RMB 439 million. Furthermore, the board of directors has approved a resolution to seek shareholder authorisation for the opportunistic repurchase of up to 10% of issued H-shares (excluding treasury shares), thereby strengthening returns to H-share shareholders.