The Chinese components maker reported record quarterly revenue and profit as higher-value smartphone parts drove growth, while its AI-related businesses remain relatively small.
By Hu Minghe
Lingyi iTech (1688.HK) (002600.SZ) reported record third-quarter revenue and profit, with growth driven by new products for a major North American customer and higher-value smartphone components, rather than the artificial intelligence businesses it highlighted during its Hong Kong listing.
The company’s results, released last week, suggest that its recovery is closely linked to the launch of Apple’s iPhone Duo foldable smartphone in October. Media reports have identified Lingyi as a supplier of components for the device, although the company has not named its customer.
Revenue rose 11% year-on-year to 15.5 billion yuan ($2.3 billion) in the third quarter, while net profit increased 14% to approximately 1.15 billion yuan. Both figures were quarterly records.
Lingyi raised capital through a Hong Kong listing in June, positioning its expansion into AI servers and robotics as key growth opportunities. But the company’s latest results underscore the continued importance of its established smartphone components business.
Its Hong Kong shares have fallen nearly 50% below their IPO price, reflecting investor skepticism toward AI and robotics-related stocks. Luxshare (2475.HK) (002475.SZ), another major Apple supplier that listed in Hong Kong in July, has also declined, with its shares down approximately 27% from their IPO price.
Foldable phones lift component value
Lingyi manufactures a range of precision components for smartphones, including adhesives, cushioning materials, heat-dissipation plates, metal frames, and chargers.
Foldable devices have provided a new growth opportunity by allowing the company to supply more sophisticated and higher-value components. Lingyi said it provides hinge components, screen supports, ultrathin cooling plates and battery casings for new products from a major North American customer. The company said production and deliveries for its foldable-phone projects were ramping up in the third and fourth quarters.
Lingyi said the value of its components used in foldable phones is several times higher than that of components in conventional smartphones. It also said the value of its parts in the latest models from its unnamed customer had increased compared with the previous generation.
The shift toward higher-value products could support revenue growth even as smartphone sales weaken. Major handset manufacturers have faced declining sales this year after raising prices in response to higher memory-chip costs.
Lingyi’s relationship with Apple dates back to its early years. Chairwoman Zeng Fangqin founded the company’s predecessor in 2006 after managing the Chinese operations of a precision-components manufacturer that supplied Nokia. Foxconn, one of Apple’s principal manufacturing partners, was also an early customer. Zeng’s success in smartphone components has made her a billionaire, according to Forbes, which ranked her 22nd on its 2026 list of China’s leading businesswomen.
AI expansion remains difficult to quantify
Lingyi’s first-half results showed a divergent performance across its established businesses. Revenue from imaging and display components, including camera brackets and screen modules, declined 37% year-on-year. The company did not explain the contraction, and its third-quarter results did not provide a comparable breakdown.
Meanwhile, revenue from automotive and air-mobility businesses nearly tripled in the first half, supported by acquisitions completed late last year. The gains largely offset the decline in imaging and display components, resulting in modest overall revenue growth.
The company is also expanding into server cooling, power hardware, and robotics. Zeng described the robotics initiative as a strategic “all in” in an interview last year, saying Lingyi would use cash generated from its existing operations to fund the expansion.
Lingyi says it is shipping server-cooling and power products and operating robot production lines in several Chinese cities, delivering both robotic joints and complete humanoid robots.
However, it does not disclose revenue separately for its AI server and robotics businesses, making it difficult to assess their contribution to overall performance.
The clearest indication of the scale of its server business comes from Readore, a server-cooling manufacturer Lingyi took control of in January. Between Jan. 31 and June 30, the acquired businesses generated approximately 405 million yuan in revenue, equivalent to about 1.6% of Lingyi’s first-half sales. Their net profit was approximately 445,000 yuan, according to the company’s interim report.
Other AI-related revenue is included in broader product categories.
Founder announces stock purchases as shares slide
Zeng has begun buying Lingyi’s Hong Kong shares following their decline. According to an Oct. 31 filing, she purchased approximately 87 million yuan worth of shares on Oct. 30, as the first step in a plan to acquire between 100 million yuan and 200 million yuan worth of stock over the next year.
News of the purchases helped support the shares, which rose nearly 10% over the following three trading sessions.
Lingyi’s earnings for the first nine months of 2026 were slightly below the same period last year, a slide the company attributed to exchange-rate fluctuations and increased research spending. Gross margin improved over the period, indicating that it retained more revenue after production costs.
The company’s full-year results will offer the next test of whether the nascent recovery that looks tied to the iPhone Duo’s launch has legs. Lingyi may have pitched AI as its next big thing to Hong Kong investors, but its rebound is so far coming from phones.
Source:
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