BRIEF: Montage Technology’s profit surges on strong AI demand

Cloud computing chip designer Montage Technology Co. Ltd. (6809.HK; 688008.SH) saidFriday that its revenue reached 5.46 billion yuan ($796 million) last year, up 50% year-on-year, while its profit rose 58.4% to 2.24 billion yuan.

The company attributed the strong gains mainly to booming demand linked to the rise of AI, which significantly boosted demand for its interconnect chips. Revenue from the interconnect chip segment reached 5.14 billion yuan last year, up 53.4% year-on-year, with its gross margin rising to 65.57%. The company’s overall gross margin for the year improved by 4.1 percentage points to 62.23%.

The company continued to step up its R&D investment last year, with related expenses rising 20% year-on-year to about 915 million yuan. Excluding share-based compensation expenses, its adjusted net profit for the year reached about 2.65 billion yuan, up 81%.

In the fourth quarter alone, Montage’s revenue rose 30.9% year-on-year to 1.4 billion yuan, while its net profit increased 39.1% to 603 million yuan.

Montage’s stock opened lower on Monday but later rebounded and closed at HK$186 by the midday break, up 3.79%. Since its listing on the Hong Kong Stock Exchange last month, the stock has climbed about 74.2% from its IPO price of HK$106.89.

By Lee Shih Ta

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