【行业研究报告】FIT HON TENG-Solid 3Q25 and strong AI revenue guidance in FY26-28E; Raise TP to HK$6.77

12Nov202512Nov2025CMBInternationalGlobalMarkets|EquityResearch|CompanyUpdateFITHonTeng(6088HK)FITHonTeng(6088HK)-Solid3Q25andstrongAIrevenueguidanceinFY26-28E;RaiseTPtoHK$6.77Solid3Q25andstrongAIrevenueguidanceinFY26-28E;RaiseTPtoHK$6.77FIT’s3Q25revenue/netprofitgrowthof13%/9%YoYislargelyin-linewithpriorguidanceandourexpectations,backedbyAIservermomentum,automobilitysynergyandrecord-highGPMat23.5%.Duringtheearningscall,mgmt.reiteratedapositive2025outlook(high-single-digitrevenuegrowth,GPMat20%),andupdatedFY26-28Eguidance,with1)2027-28Erevenuegrowthofmid-20%(vspriorlow-20%)and2)AI/cloudrevenuemixof“low/mid/high-20%in2026/27/28E”.Overall,webelieveFITiswellpositionedtobenefitfromsharegainsandAIserverconnectivitysolutionsupgrade,backedbyitssolidproductpipelineandsynergywithHonHai.WehaveadjustedFY25/26/27EEPSby-1%/+9%/26%tofactorin3Q25resultsandupbeatrevenue/mixguidance.WeraiseTPtoHK$6.77basedonhigher20xFY26EP/E(vsprior16x),giventheAIserverproductcycle,40%FY24-27EEPSCAGRandhigherearningsvisibilityintoFY27-28E.Thestocktradesat15.5xFY26EP/E(vs24xfor1-sdabove8-yravg.P/E),andweexpectfurtherre-ratingonhigherAIrevenuecontributioninFY26-27E.BUY.3Q25largelyin-linewithhighercloud/automobilityrevenuemix.FIT’s3Qrevenue/NPgrowthof13%/9%YoYislargelyin-linewithpriorguidanceandourexpectations,drivenbystrongAIproductdemand(+33%YoY)andautomobilitybusiness(+116%YoY),offsettingsmartphone/consumerweakness(-20%/flatYoY).Inaddition,weareencouragedbyrecord-highGPMof23.5%(vs17.8%/21.7%in2Q25/3Q24)thankstohigherrevenuecontributionofAIserver/automobilebusinesses.4Q25/2025outlook:AIserverrackramp-upandOne-Mobilitysynergy.Mgmt.reiterated2025guidanceofhigh-single-digitYoYrevenuegrowthwithGPMat~20%,andprovideddetailson4Q25/2025outlook:1)Cloud/datacentertodeliverhigh-20%/30%+YoYin4Q/FY25EonnewAIserverrackramp-upandgeneralserverupgrade;2)Automobilitytogrowmid-double-digit/40%YoYin4Q/FY25E;3)ConsumerinterconnectstostayflattishYoYonmacroheadwinds;4)Smartphonebiz/systemproductstoposthigh-teensdecline/beflattishin4Q/FY25Eduetomarketweakness.FY27-28Eguidance:robustAIdemandwithstrongproductpipeline(CPC/CPO/backplaneconnectors,liquidcooling,800V).Mgmt.sharedupdatesonAIproductlaunchesinCIOE/OCP,including1)Connectors:102.4TbpsCPOconnectors,CPC224Ginterconnectsolution,1.6Tactive/passivecoppercables,2)Cooling:51.2Tswitchcoolingandfull-flowQDliquidcoolingcouplers,and3)Power:800V/±400Vpowerbusbarand400A/100AACwhipconnectors.Overall,mgmt.guidedmid-20%YoYrevenuegrowthinFY27/28E(vs.priorlow-20%)andcloud/datacentersalesmixoflow/mid/high-20%inFY26/27/28E,boostingprofitabilityinthelongrun.TargetPriceHK$6.77(PreviousTPHK$4.96)Up/Downside29.0%CurrentPriceHK$5.25ChinaTechnologyAlexNG(852)39000881alexng@cmbi.com.hkHanqingLIlihanqing@cmbi.com.hkStockDataMktCap(HK$mn)38,151.8Avg3mthst/o(HK$mn)806.152wHigh/Low(HK$)7.02/1.71TotalIssuedShares(mn)7267.0Source:FactSetShareholdingStructureFoxconnFarEastLtd71.1%LuSung-Ching5.5%Source:HKExSharePerformanceAbsoluteRelative1-mth-18.4%-19.6%3-mth45.4%35.7%6-mth156.1%119.4%Source:FactSet12-mthPricePerformanceSource:FactSetRelatedReports:1.FITHonTeng(6088HK)–2Qbusinesstransitionaccelerated;AIcables/liquidcooling/power/automomentumontrack–14Aug2025(link)2.FITHonTeng(6088HK)–1Q25resultsbelow;Guidanceloweredonsmartphone/systemproductsduetomacrouncertainties–12May2025(link)3.FITHonTeng(6088HK)–DecentFY24results;Expectationsresetonmoreconservativeguidance–13Mar2025(link)4.FITHonTeng(6088HK)–FY24EPreview:robustearningsrecovery;ExpectAIservermomentumtodrivere-rating–27Jan2025(link)EarningsSummary(YE31Dec)FY23AFY24AFY25EFY26EFY27ERevenue(US$mn)4,1964,4514,8835,8597,103YoYgrowth(%)(7.4)6.19.720.021.2Netprofit(US$mn)129.6154.3190.7309.5424.4YoYgrowth(%)(23.8)19.123.662.337.1EPS(Reported)(US$cents)1.822.172.684.355.97ConsensusEPS(US$cents)nana2.823.784.56P/E(x)37.131.125.215.511.3P/B(x)2.01.91.81.61.4Yield(%)0.00.00.00.00.0ROE(%)5.46.37.410.913.3Netgearing(%)0.0nanananaSource:Companydata,Bloomberg,CMBIGMestimates