Ladies and gentlemen, thank you for standing by. Welcome to the Hua Hong Semiconductor's first quarter 2026 earnings conference call. Today's call is hosted by Dr. Peng Bai, Chairman and President, and Mr. Daniel Wang, Executive Vice President and Chief Financial Officer. Please be advised that your dial-ins are in listen-only mode. However, at the conclusion of the management presentation, there will be a question-and-answer session. At which time, you will receive instructions on how to participate. The earnings press release and first quarter 2026 summary slides are available to download at our company's website, www.huahonggrace.com. Without further ado, I would like to introduce you to Mr. Daniel Wang, Executive Vice President and Chief Financial Officer. Thank you.
Good afternoon, everyone. Thank Thank you for joining our Q1 2026 earnings conference. Today, we will first have Dr. Peng Bai, our Chairman and President, provide a overview of our first quarter performance. I will then take you through our financial results in detail and offer guidance for the upcoming quarter. We'll open the floor for a question-and-answer session. With that, I turn the call over to Dr. Bai. Dr. Bai.
Thank you, Daniel. Good afternoon, everyone. Thank you for joining our earnings call. Hua Hong Semiconductor generated revenue of $660.9 million in the first quarter of 2026, a year-over-year increase of 22.2%. Gross margin stood at 13%, a year-over-year increase of 3.8 percentage points. Both figures were in line with our guidance. Net profit attributable to shareholders of the parent company amounted to $20.9 million, marking substantial year-over-year growth. Despite the rapid capacity ramp-up, the company maintained high capacity utilization rates with strong performance across all process technology platforms. MCU, standalone flash, and BCD products delivers the highest growth rates.
The company's results were supported by sustained efforts in cost reduction and efficiency enhancement and by a positive demand signal that started at the beginning of the quarter and became stronger over the course of the quarter. The global semiconductor industry is undergoing accelerated transformation as AI and related applications play an increasingly central role in market dynamics. The unmistakably positive impact of AI on worldwide semiconductor market demand, persistent uncertainty in the global supply chain landscape make a more complex market picture that we are facing with. Hua Hong Semiconductor remains steadfast in pursuit of its key objective of becoming a foundry leader in specialty process technologies, with a core strategy of continuous focusing on market needs, strengthening our process technology capabilities, and substantially increasing production capacity scale.
In the first quarter, the ramp-up of our 12-inch capacity progressed steadily, with its revenue contribution rising to 62.7%, while our 8-inch production line maintained sound profitability. Meanwhile, the proposed acquisition of Huali Micro has been accepted by the Shanghai Stock Exchange, entering the substantive review phase. The acquisition is currently progressing according to the established schedule and is expected to be completed in the second half of the year. Finally, as a veteran of the industry, I remain confident in a bright future for semiconductor industry globally and in China. I'm fully committed to make Hua Hong Semiconductor an increasingly important player in the industry and deliver sustainable value to our shareholders. I would like to hand the call over to our CFO, Mr. Daniel Wang, for his comments. Daniel.
Thank you, Dr. Bai, for your inspiring comments. Let me walk you through a summary of our financial performance for the first quarter. I will provide our revenue and margin outlook for Q2 2026 before opening the floor for the Q&A session. Let us review our financial results for the first quarter. Revenue was $660.9 million, 22.2% over Q1 2025, primarily driven by increased wafer shipments and improved average selling price, and 0.2% over Q4 2025. Gross margin was 13%, 3.8 percentage points over Q1 2025, primarily driven by improved average selling price and cost reduction efforts, and flat with Q4 2025.
Operating expenses were $105.6 million, 8.8% over Q1 2025, primarily due to increased operating expenses for the new production line in Wuxi, and 18.9% lower than Q4 2025, mainly due to decreased labor costs. Other lost net was $2.4 billion, 70.5% lower than Q1 2025, primarily due to foreign exchange gains versus foreign exchange losses in Q1 2025, partially offset by decreased government subsidies, interest income, and increased finance costs. It was other income net of $34.1 million in Q4 2025, mainly due to increased finance costs and the decreased government subsidies. Income tax credit was $4.7 million, primarily due to a reversal of dividend withholding tax for 2025.
Net loss for the period was $17.3 million, narrowed by 66.9% compared to Q1 2025 and the 7.5% compared to Q4 2025. Net profit attributable to shareholders of the parent company was $20.9 million, 458.1% over Q1 2025 and 19.9% above Q4 2025. Basic earnings per share was $0.012. Annualized ROE was 1.2%. Let's take a closer look at our Q1 2026 revenue performance.
From geographical perspective, revenue from China was $525.2 million, contributing 79.5% of total revenue and an increase of 18.7% over Q1 2025, mainly driven by increased demand for MCU, other Power Management IC, flash, and IGBT products. Revenue from North America was $85.7 million, an increase of 51.9% over Q1 2025, mainly driven by increased demand for other Power Management IC and MCU products. Revenue from other Asia was $28.2 million, an increase of 5.2% over Q1 2025, mainly driven by increased demand for MCU products, partially offset by decreased demand for Superjunction product.
Revenue from Europe was $21.8 million, an increase of 43.2% over Q1 2025, mainly driven by increased demand for smart car IC, IGBT, and MCU product. With respect to technology platforms, revenue from embedded non-volatile memory was $184.6 billion, an increase of 41.7% over Q1 2025, mainly driven by increased demand for MCU and smart car ICs. Revenue from standalone non-volatile memory was $57.1 million, an increase of 33.2% over Q1 2025, mainly driven by increased demand for flash products. Revenue from power discrete was $170.9 million, an increase of 5% over Q1 2025, mainly driven by increased demand for IGBT and general MOSFET products, partially offset by decreased demand, excuse me, for Superjunction products.
Revenue from Logic and RF was $74.4 million, an increase of 11.4% over Q1 2025, mainly driven by increased demand for Logic and the CIS products. Revenue from analog and power management IC was $173.9 million, an increase of 25.8% over Q1 2025, mainly driven by increased demand for other Power Management IC products. Let's turn to our cash flow statement. Net cash flows generated from operating activities was $130.4 million, 159.9% over Q1 2025, mainly due to increased receipts from customers. It was 47% lower than Q4 2025, largely due to decreased receipts of government grants and increased payments of labor costs.
CapEx were $924.9 million in Q1 2026, including $886.1 million for Hua Hong twelve-inch business and $38.7 million for Hua Hong eight inch. Other cash flow generated from investing activities was $67.9 million in Q1 2026, including $57.8 million decreased time deposits, $10 million interest income, and $100,000 receipt of disposal of equipment. Net cash flows generated from financing activities were $638.7 million, including $649.4 million proceeds from bank borrowings, and $3.3 million proceeds from share option exercises, partially offset by $12.1 million interest payments and $1.1 million lease payments and $0.8 million of bank principal repayments.
Let's move to the balance sheet. Cash and the cash equivalents was $4,867.9 million on March 31, 2026, compared to $4,893.8 million on December 31, 2025. Other current assets increased from $787 million on December 31, 2025, to $894.6 billion on March 31, 2026. Twenty twenty-six, mainly due to increased value-added tax credit. Property, plant, and equipment was $7,105.9 million on March 31, 2026, compared to $6,676.4 million on December 31, 2025, primarily due to capacity expansion in the Far East manufacturing.
Interest-bearing bank borrowings increased from $3,190.8 million on December 31st, 2025, to $3,897.2 million on March 31st, 2026, primarily due to increased drawdowns of bank borrowings. Total assets increased from $14,453.8 million on December 31st, 2025, to $14,947.3 million on March 31st, 2026. Total liabilities increased to $5,663 billion on March 31st, 2026, from $5,289.5 million on December 31st, 2025. Debt ratio increased to 37.9% on March 31st, 2026, from 36.6% on December 31st, 2025. Let's take a look at our second quarter outlook for our 2026.
We expect revenue to be in the range of $690 million-$700 million with a projected growth margin of 14%-16%. This concludes my financial remarks. We'll now begin the Q&A session. Operator, please assist. Thank you. Operator?
Yeah, participants, as a reminder, if you wish to ask a question, please press star 1 1 on your telephone keypad and wait for a name to be announced. To withdraw a question, please press star 1 and 1 again. Please stand by while compile the Q&A roster. This will take a few moments. Now we're going to take our 1st question. It comes to the line of Leping Huang from Huatai Securities. Your line is open. Please ask the question.
Thank you for taking my question. Congratulations for the very strong result. My first question is about the impact of the memory super cycle. We see the further price hike of the memory in last 3 months. Dr. Bisel, what's your view on the ripple effect on this trend on the logic foundry investment, especially on your NOR flash business? Can we expect a further price hike in the memory will drive the ASP and the margin expansion in your logic foundry business in remaining of this year? Thank you.
Okay. Thank you, Leping. Good to hear from you. Yes, let me take your question on the NOR flash situation. You're right. First of all, the memory is in short supply, starting with the DRAM. DRAM price, as you know, went up probably like 10x. They start spill over into NAND memory. It started spill over a little bit into NOR flash as well. It's not as much spill over as I would like, but definitely we see the demand going up for our NOR flash memory.
Price increases, not as significant as the DRAM. Not nearly as significant as the DRAM. We should expect to be 10%-15% price increases on the NOR flashes. Also, with the tight supply, we won't be able to satisfy all the demand, but we do get the benefit of higher prices.
Okay. Yeah. Thank you. My second question is, Can you provide some update on the progress of your Wuxi Fab expansion? I remember you mentioned last time, I can start already construction in March and then moving in October. These days we see a very fast expansion of the most of the foundry and the memory company in the world. Do you see any delay of the equipment delivery? Furthermore, today with the U.S. President visiting China, which is a very important milestone for the U.S.-China relation. Do you think that this will help the equipment procurement coming in the rest of the year? Thank you.
Okay. Yes. Let me update you on our Wuxi site in terms of the capacity expansion. As you know, Wuxi site we have two operating fabs already. The third one, as you correctly pointed out, started construction in March. Before I go to the third fab, which we call nine B, the second fab has been on a capacity ramp up since last year. It's a Fab nine A. That capacity ramp up should complete in Q3 this year, which means that we will reach the full capacity in Q3. The output, there's an obviously a delay in getting all the output with the full capacity, but we should be getting the full output starting probably by end of this year or beginning of next year.
The 3rd fab, Fab 9B, we kicked off the construction in March of this year. We are doing all the facility work right now because the shell is already there for the 3rd fab. We expect the equipment start to come in in the 4th quarter of this year. To your question about the equipment procurement, we do not see any impact in term of the export control from the U.S. export control on the equipment procurement for Fab 9B. That has not been a issue for us. Now, President Trump is in China as we speak. We certainly hope this environment is gonna be further relaxed going forward. We'll see how is it come out.
After this point, even all the press reports notwithstanding over the last couple of months, we have not been impacted in terms of getting the equipment we need to buy and also the delivery time.
Okay. Yeah. It's good to hear. Final question is that we see the Hua Hong Group establish a advanced packaging subsidiary. Also, the market is very closely watching the next generation technology like silicon photonics. My question is how the Hua Hong Group's advanced packaging subsidiary will coordinate with Hua Hong Semiconductor, and what's the technology you have on the silicon photonics, and what's your plan on silicon photonics? Thank you.
Okay. Let me take on your question, one at a time. One is the advanced packaging. Yes, there is a newly established effort on advanced packaging. It's under the Hua Hong Group, not the part of the public company. Not part of Hua Hong Semiconductor. Of course, we are having a lot of coordination at the Hua Hong Group level in terms of the technology roadmap and as well as the capacity planning. In that regard, certainly are coordinated with the existing Hua Hong Group companies. Advanced packaging is basically a definitely a high growth area in the industry.
We expect that effort to substantially add to our offering, also expect to add to our revenue in the future at the group level. The silicon photonic is another area that is growing pretty fast, especially with AI and related applications. We are also looking at getting into silicon photonic area. There is quite a bit of a planning activity that's ongoing. Once something get finalized, I expect that will be soon, that we will update you on the detail. Suffice to say that yes, we will get into silicon photonics. Since this is a growth area, is adjacent to what we already do, so it should have a lot of good synergy with what we already have.
We should expect that to be started pretty soon. Right.
Okay. Thank you. Thank you very much.
Thank you. Now we're going to take our next question. The next question comes from the line of Tracy Cui from CLSA Company. Your line is open. Please ask the question.
Okay. Thank you. Thank you, Dr. Bai, Daniel, and senior management for giving me this opportunity for questions. My first question is regarding your 2Q 2026 revenue guidance. Would you please guide us how much growth may come from the shipment growth and how much from the ASP increase? Thank you.
You know, it's roughly, it's about, you know, we're talking about quarter-to-quarter, around close to 5%. Okay. We're pretty confident with that number. It's coming in combination of, revenue, ASP growth and also volume growth. Thank you.
Okay, thanks. Just following up for the wafer price, perhaps how you will expect your wafer price trend throughout this year, and which type of chips you may see maybe a higher chance to for the price list? Thank you.
Since we have a diverse portfolio of technology platform, we do see the price changes, price increases vary across different platforms. The ones that are in higher demand will see a higher price increases. The ones that demand are somewhat muted, we will probably try to stay where it is or just with a very minor increases. The net result is that on average, I do think we're gonna be consistent with the industry average about 10%, plus minus some number there, here and there. You have to realize the price increases, it takes time to get implemented. Yes, as even you increase the prices, it's the order from that day forward that see the new prices.
That you will take sometimes to fully materialize all the increases to have them fully reflected in the financial results. During the course of this year, I think, we're definitely will be seeing about on average. Some will increase more, like some of the, we do this mainly based on market. It's a market-driven methodology. If you see a lot of demand, we do tends to increase the prices a little bit more. Some platform might see up to 20%, 25 even, but some are gonna be close to where they are and maybe 5%. On average, I think, 10% is a reasonable assumption, or 10%-15% by end of this year.
Somewhere there.
Got it. Yes. Thank you, Dr. Bai. Can I please also have a follow-up question on Fab 9 B? Would you mind remind us how much is our CapEx plan and how much is the designed capacity? Any updated timeline in terms of the capacity investment and also the ramp up, and what may be the process mode and the type of chips platforms. Thank you.
I think the Fab 9B, the overall project, I think we're gonna be putting down CapEx-wise about $60 billion, maybe right around there. It will be $60. We actually originally said $69. We will try to.
$6 billion.
I mean $6 billion, not 60. For 60. $6 billion, okay? Like, take off 1 zero there. Originally we were thinking 6 point something, but we will try to control it to be about $6 billion. Overall investment on that will be spent this year and next, pretty much. It will start to equipment started coming towards the end of this year, so we are talking about it will start to produce output in 2027. Probably going to take a year and a half to 2 years to get all the capacity in place to get all. You are talking about in 2028, the fab might be, will be at a full capacity. That's the rough schedule I'm giving you.
What might be the process node type of chips? Any color that you may able to share? Thank you.
It will be focused on specialty technologies. It will be a range of nodes, but the bulk will be 40 nanometer. 40 nanometer plus minus something.
Okay, sure. Thank you, Dr. Bai. Thank you, Daniel. That's all for me, and I will go back to the queue. Thank you.
Thank you.
Thank you. Now we're going to take our next question. The next question comes line of Ziyuan Wang from CITIC Securities. Your line is open. Please ask the question.
Okay, thank you for taking my question. This is Ziyuan Wang from CITIC Securities. My first question is about, I'm wondering how has the demand changed in analog and the power applications over the past quarters? Is there any further plan for the wafer price to increase on Q2? Have there been any price increase in the materials such as silicon wafers? Thank you.
The analog area, our main product is Power Management ICs. We do see strong demand there. That's mostly related to AI and AI-related build-out, like the server boxes. They need a lot of Power Management ICs. That's partially offset by some of the consumer weakness because of the DRAM increases. We do see a memory price increases has a small depressing effect on consumer segment. Overall, it's a positive story for us because we obviously have products in both AI-related field as well as consumer. On average, AI-related stronger demand overwhelms, at least, more than compensate for the small weaknesses in consumer.
In that regard, I think the analog, the PMIC area is a good example where you have 1 part of the market going strong, another part is a little bit muted. Overall, still a positive, in demand increasing story for us. We, yes, we will, you will see price increases in this particular platform. Reasonable price increases here. In terms of the supply chain, because of probably mostly because of the war and some of the, its disruption that it causes, we do see some particular material, raw material, the prices go up. It's not across the board. On across the board, it's not a very significant factor yet. There's a few items that prices do go up quite high.
We're managing that, and those are manageable. We don't expect, I do not expect that it will have a big overall impact. Yes, because of mostly because of war, oil in Middle East that is causing some supply chain disruption. In particular, the ones, the oil, the oil-related or gas, oil-related products and some of the item, the prices spike little bit. A very few item. It doesn't have an average impact much. All right. Thank you.
Okay, got it. Thank you, Dr. Bai. My second question is about, does our company have any plan or investments on the compound semiconductor, such as the gallium arsenide or silicon carbide or even indium phosphide? That's my second question.
Well, thank you for asking. The answer is yes. We have started effort in gallium nitride. We already have a TD activity going on, so we were getting to gallium nitride and as well as silicon carbide. The compound semiconductor. Those two that complement our silicon-based power devices, we have decided to get into. The way we get into, might be a little bit different. Like I said, in carbide, we might have a joint venture with some existing joint venture in terms of the capital management. In gallium nitride, we might seek a partner when we get into the volume manufacturing phase. That part is still being kind of planned or is not finalized.
The answer to your question, yes, we will get into gallium nitride. We are getting to gallium nitride and silicon carbide effort because we have a large silicon-based power device capacity. We also have a large base of customer, and they are also asking us to get into the compound, so that compound semiconductor to complement our existing silicon-based power devices. Indium phosphide? No, we are not.
Okay. No, sorry. I'm sorry. Sorry. Go on, please.
We can't hear you.
Oh, my apologies. Please continue.
We don't hear anybody speaking online.
Philip, next.
Yes, of course.
Okay, that's all my questions. Thank you. Very clear.
Thank you, Ziyuan. Dear participants, as a reminder, if you wish to ask a question, please press star 1 1 on your telephone keypad. Now we're going to take our next question. The question comes line of Timothy Wang from Oriental Asset Management. Your line is open. Please ask your question.
Hello, Dr. Bai. Hello, Daniel. Here's An from Oriental Asset Management. My name is Timothy Wang. My first question would be, I would like to confirm whether we are acquiring 7 nanometers or below to our portfolio since through the acquisition of Huali Microelectronics as some news reports suggest. Thank you. This is my first question.
Sorry, Did you get that question?
Well, you know, can you repeat that question again?
Yes. Okay. I would like to confirm whether we are acquiring 7 nanometer or below to our portfolio, through the acquisition of Huali Microelectronics, as some reports suggested. Thank you.
Well, a couple of things. One is, our Q1 results does not include Huali Microelectronics. That's still outside the Hua Hong Semiconductor because it has not complete the acquisition. Second, Huali Microelectronics, what are we acquiring from for Huali Microelectronics is basically what do we call Fab 5 asset. The Fab 5 asset and business, those are based on 55 nanometer and 40 nanometer IC products. That's what we are acquiring.
Yes. I actually didn't believe such reports, so thank you for your clarification. My second part of my question is, I would like, would you mind giving some color on the explosion of CPO, silicon photonics optics? How would these trends benefit us?
Oh. This is, I think right now, in light of, from technical standpoint of view, a lot of high compute platform, the interconnect become a bottleneck. People are looking for ways to speed up the interconnect. Silicon photonics is one way. Now, there are some detail there that depend on whether you're talking about the stack to stack, like a box to box communication, some chip to chip. You actually require slightly different silicon photonic technology. That's the area that would require a silicon photonics type of products. This is consistent with now AI is driving a lot of the market growth.
If you believe in this thesis that AI is gonna drive a lot of growth, then you would believe that you would say that there's gonna be more demand for silicon photonics related products. AI obviously at a system level is a high compute systems. That's the. From Hua Hong standpoint of view, we our technology, although silicon photonics is a new technology for us, but it's also adjacent technology for us. It's not too different, too far away from what we're already doing. We're already doing a lot of CIS, which require BCD, not BCD, BSI, we require a lot of backside processing. Also get into other ones packaging area.
There is quite a bit of synergy from technology standpoint of view. That's why we think this a good area for us to get into because there is gonna be market demand, and it also play into kind of our strength or our adjacent area of growth.
Thank you.
Thank you. Thank you very much, and congratulations for all the progress.
Thank you. Thank you.
Thank you. Now we're going to take our next question. The question comes line of Jiang Kai from Orient Securities. Your line is open. Please ask your question.
All right. Dr. Bai, Mr. Wang, my first question is about the memory price. How do you see the memory price in the next few quarters?
Well, the price is a sensitive topic, and in the end, the price will be set by supply-demand balance. As long as we continue to have a short supply, then we have a little bit of opportunity to inch up the prices. We actually will stop price increases when the supply-demand balance is reached. At this point in starting this year, we start to see tightness of the supply, and we continue to see that. We are going through 1 round of price increases. We have gone through 1 round of price increases. That's now fully reflected. It will take a little bit of time to see how it's impacting the order and how it's impacting the overall market.
We will be watching that and then decide whether the balance is reached, or if it's not reached, then we may inch up a little bit more. We've frank and open about this one. If the price, the demand is supply/demand is more or less at the good balance, we probably gonna pause or gonna stop increase in prices. I said, for the year, we expect on average, I said earlier, 10%, maybe if we're lucky, it will be 15%, 10-15%. Memory is one of the platform that the increase is probably will be above the average.
Okay. Thank you, Dr. Bai. My second question is about the AI server opportunity. As we know, we already are making some like analog for some for AI server. We can see power discrete the usage are also increasing in AI server. From our point, how do you see the opportunity for us? Maybe just now you also mentioned like silicon photonics or maybe combine all this together, how do we see the opportunity?
Yeah. The power devices, the overall market actually, you're correct, is actually increasing because of all the AI boxes need power devices. Plus, some of the new, like, robotics or the industrial demand is also increasing the demand for power devices. The issue there probably is not so much overall market demand. We do see that part is reasonably healthy. The power devices in terms of the issue is probably the supply also increases quite fast, especially the compound semiconductor, like I said earlier, silicon carbide start to contribute a significant portion to power devices. That here you have a situation where the supply-demand balance is now they're off. Therefore, for us, to win business, we have to be, it's a competitive market.
It's, you have to compete with our competitors. Now, we do have a good silicon-based power device technology. We have that in the area. I think the part we need to do more is to get the compound semiconductor as part of offering. That's why earlier I said we are getting to silicon carbide and gallium nitride, the compound semiconductor, so that we can first provide a more complete solution to our customers and also give our customers more choices, more flexibility in terms of coming up with an optimal combination of the power devices to support increasing demand. That's the situation I see. Silicon photonics is a different story. That is, we're starting from scratch. That is a nascent, new development that is getting more and more important.
I think that we don't have a silicon photonics offering right now. For us, anything we get there will be a net addition to our business.
Okay, thank you. Bye bye.
Thank you. Now we're going to take our next question. The question comes line of Charlie Chan from Morgan Stanley. Your line is open. Please ask your question.
Hi, Dr. Bai and Daniel. Thanks for taking my question. I actually have 2 question. One is about your PMIC capacity expansion. I'm not sure if it's the right understanding, but could it be like a BCD process? Do you think you can extend the capacity given demand is so strong and also customers are willing to pay higher price? If they cannot get a capacity from your fab, where they can go to get the sufficient supply?
The power management product, it does use BCD technology problem. You are correct. That's the technology problem we're talking about, BCD. That's number one. Number two, we are expanding the BCD capacity. That is already one of the highest capacity problem we already have. We are expanding as we speak, in both Wuxi as well as maybe in Huali Micro that we are about to acquire. We will get higher capacity because we're now meeting the customer needs. Third, you are correct that BCD area is a competitive, it's a competitive marketplace. There are many players there, we have been one of the biggest players in China.
Partly because we have a good, we think we have a good technology advantage, and we also have some very valuable, strategic customers that work with us. We think we can increase the capacity and still be able to get a good price on them. That's why we are doing a capacity expansion. This is also an area that we are focusing on in terms of technology development to try to get to next generation faster so that we keep that technology edge for us.
All right. Thanks, Dr. Bai. My second part of this question is, I also cover some Taiwanese foundry, for example, UMC, Vanguard, if I may call, those are your industry peers. It seems like their 1st quarter, 2nd quarter with 1st shipment sort of outgrow. I think 1 quarter grow single digits to 2Q, like high single digit Q on Q. I'm not sure, after your capacity expansion, do you feel like you can win back some customers, you know, either consumer side or those non-China customers, you know, either U.S. customers or Taiwan customers back to your fab for a PMIC production?
Our PMIC business has grown in Q1. If we had more capacity, we probably could have done better. As our new capacity come online, we do think that we can keep growing that part of business. We already have a customer from overseas, from U.S. and Europe for that matter. Because for European customer, they have this in China for China strategy that we do benefit from. U.S. company, mostly because of their business growing very fast, so they need more supply. In that sense, that we think BCD area or PMIC area, it is one area that is benefiting from the AI and AI related growth.
Also all the other, the car also need a PMIC and robotics overall. The only, from end market standpoint, the only place we see some weakness is in the consumer segment. That we do see that. The hope is that the area that's been growing keep on growing, like AI and robotics and the cars, auto, and the consumer maybe will come back. Because they can't keep delaying those, they can't keep on pushing out the new model forever, they have to also get on the growth or stop the decrease a little bit. That's the overall picture I see.
Great. Thanks. My, my second question, you know, is some clarification on your comments. On your kind of prepared remark, you, you sort of talked about hopefully some re-relaxation of the export control on equipments. I think your Fab nine, right? As you just described, it's more like a 40 nanometer. If that's the case, why there's a kind of export control? You were referring to your Not your, but the Huawei's Fab eight. Can you clarify your previous comment about the equipment restriction?
I was not talking about Huawei. I was talking about just Hua Hong. You are correct. I also said we have not been impacted by the export control. In terms of the equipment we really need to buy. When I say if the restriction is more relaxed, in general, we will get more choices. It's always good to have more choices, right? I might be able to have a little bit more optimal combination of the tools. It's not easy.
Oh.
if we can. Okay.
Oh, I see. I see.
I'm not-
It's kind of nice.
Nice. Yes. Yes.
Okay. So nice to have. Even, it's a core, it doesn't change your extension for Fab nine. Is that right way to think about this?
Correct. That's correct.
Okay, cool.
And, and-
Lastly, I think 1 of the previous callers asked about some Amkor new business, right? I think for global OSAT supply chain, I think there are lots of realistic component, for example, interposer, bridge die, silicon capacitors, there's a PIC, you know. Do you have any demand out for those? I think the previous question was about CPO related, I wanted to ask about all those kind of CoWoS or 2.5D packaging related components, no matter silicon capacitor, interposer, bridge die, or PIC. Do you have any demand for those components?
Good question. We do see demand for high density capacitor. We are having a effort there.
capacitors, deep trench or other, or otherwise. Those high density capacitors. It looks like it's been there for a while now that we should start to see some revenue coming. In terms of the other one, say, can you ask the question? Oh, interposer.
Yeah.
This is also something that we are very open to it.
That might. We are exploring some option there. That's still in the early stages. That probably gonna go with when we have our advanced packaging coming online. The interposer will also become a significant part of the overall packaging effort.
Okay, great. Thanks for your answers. Thank you.
Thank you. Ladies and gentlemen, that's all time we have for questions. I will now hand back to Mr. Daniel Wang for closing remarks.
Well, you know, thank you very much for joining us today. I mean, you guys had a lot of wonderful question. All these questions were Has been very, very helpful, and we look forward to speaking with you again and then perhaps seeing you in the next quarter. Thank you very much. Talk to you. Bye.
Thank you.
This concludes today's conference call. Thank you for participating. You may now all disconnect. Have a nice day.