Hengtong Optic-Electric Posts Q1 2026 Revenue of RMB 12.85 Billion, Up 8.45% Year-over-Year

On April 25, 2026, leading optical communication company Hengtong Optic-Electric (600487.SH) officially released its first-quarter 2026 earnings report, delivering a solid growth performance. Against the backdrop of continued expansion in AI computing infrastructure, the company achieved year-over-year growth across all core financial metrics, demonstrating strong business resilience.

Steady Q1 Growth with Improving Profitability

According to the quarterly report, Hengtong Optic-Electric recorded revenue of RMB 12.85 billion in Q1 2026, representing an 8.45% year-over-year increase. Net profit attributable to shareholders reached RMB 612 million, up 12.30% YoY, while non-GAAP net profit attributable to shareholders came in at RMB 585 million, up 14.15% YoY. Notably, the growth rate of non-GAAP net profit significantly outpaced revenue growth, indicating continuous improvement in the profitability quality of the company's core operations, with notable results from cost control measures and product mix optimization.

From a margin perspective, the growth rate of net profit attributable to shareholders exceeded revenue growth by nearly 4 percentage points, while non-GAAP net profit growth outpaced revenue growth by approximately 5.7 percentage points, reflecting the company's ability to achieve simultaneous — and even outsized — profitability gains alongside scale expansion.

AI Computing Wave Drives Sustained Expansion in Optical Communication Demand

Hengtong Optic-Electric's steady performance is closely tied to the booming global AI industry. As demand for computing power grows exponentially driven by large language model training and inference, data center construction has entered a new expansion cycle. As the core medium for intra-data-center interconnection and wide-area network transmission, demand for optical fiber cables and optical modules continues to surge.

At the industry level, since 2025, major technology companies both domestically and internationally have significantly ramped up AI infrastructure investment. Overseas cloud providers such as Microsoft, Google, and Amazon have continuously set new records in capital expenditure, while domestic players including Alibaba Cloud, Tencent Cloud, and ByteDance are also accelerating the deployment of intelligent computing centers. These large-scale infrastructure investments have directly boosted order growth across the upstream optical communication supply chain. As a leading domestic player in optical fiber cables and submarine communications, Hengtong Optic-Electric has naturally emerged as a key beneficiary of this AI infrastructure boom.

Additionally, the accelerated deployment of 800G and even 1.6T high-speed optical modules, along with iterative upgrades in intra-data-center optical interconnect technologies, have opened broader growth opportunities for Hengtong's high-end product lines. The company's long-term accumulation of core optical communication technologies is now translating into tangible earnings contributions in the AI era.

Submarine Cable Business and International Expansion Form a Second Growth Engine

Beyond its core optical fiber cable business, Hengtong Optic-Electric's strategic positioning in submarine optical cables and offshore wind power cables also warrants attention. As global offshore wind projects accelerate and transoceanic data transmission demand surges due to the explosion of AI applications, the submarine cable business is poised to become a significant growth driver for the company. Hengtong has already achieved international competitiveness in submarine cable manufacturing and installation, with multiple overseas project wins opening up pathways for global expansion.

Outlook and Risk Considerations

Looking ahead to the full year of 2026, Hengtong Optic-Electric's growth thesis remains clear. On one hand, the continued iteration and commercialization of large AI models will sustain demand for computing infrastructure buildout, and the high-growth cycle for optical communications is expected to persist. On the other hand, the deepening implementation of China's "East Data West Computing" initiative and the large-scale deployment of 5G-A networks will provide stable domestic market support.

However, investors should also be mindful of potential risks. Competition in the optical fiber cable industry remains intense, and raw material price fluctuations could pressure margins. Overseas operations face geopolitical and foreign exchange risks. Furthermore, if the pace of AI computing investment slows, downstream demand may experience periodic pullbacks.

Overall, Hengtong Optic-Electric's Q1 2026 results met market expectations. Driven by the long-term theme of AI computing infrastructure buildout, the company's performance is expected to maintain a steady growth trajectory, and its position as a core supplier of AI infrastructure deserves continued attention.