1Q26 earnings: Brighter than a shooting star

中际旭创(300308)
    Innolight delivered a standout1Q26,with revenue jumping192%YoY/47.3%QoQ to RMB19.5bn(vs.Bloomberg consensus of RMB15.4bn),and net profitsurging262%YoY/56.5%QoQ to RMB5.7bn(vs.RMB4.4bn consensus),bothmarking new quarterly highs.During the period,GPM expanded further to46.1%(vs.44.5%in4Q25),primarily due to improving mix and rising SiPhopenetration.Mgmt.framed the strong quarter not as a one-off outperformancebut as a reflection of sustained demand strength and improved execution,withrobust capacity ramp-up,including Thailand,and resilient raw materialprocurement supporting shipment in a tight S/D backdrop.Maintain BUY withTP adjusted to RMB1,080on28x rollover2027E P/E(prev.28x2026E P/E).
    800G and1.6T ramped up in tandem,with rising SiPho mix furtherlifting margin.Revenue strength was driven by concurrent ramp-up in both800G and1.6T products,indicating that growth is broadening across thecompany’s high-end optical portfolio rather than being tied to a singleproduct inflection.Mgmt.highlighted meaningful contribution from both800G and1.6T shipments in1Q26,with the richer product mix continuing todrive margin higher.Within1.6T,SiPho is expected to account for more thanhalf of shipments this year,reinforcing our view that rising SiPho penetrationshould remain an important structural support to margin.
    NPO is the earlier catalyst,while XPO provides broader deploymentflexibility.Mgmt.indicated NPO has already received explicit customerdemand indications and could enter volume production in2027,with the usecase tied primarily to scale-up architectures.XPO,by contrast,is still inactive customer promotion,but was positioned across both scale-up andscale-out scenarios,with transmission reach of roughly100m to2km,implying broader deployment potential once commercialization visibilityimproves.
    Maintain BUY with TP revised to RMB1,080on rollover28x2027E P/E,supported by an order backlog that now stretches through2026andinto2027(and even beyond).In our view,what stood out this quarter wasnot only the magnitude of the beat,but the quality of execution behind it:Capacity expansion landed on time,supply-chain preparation remainedeffective despite tight upstream conditions,while product mix was movingstructurally upward.We believe this supports a more durable earningsprofile and strengthens confidence that Innolight can capture incrementalupside from future architectural shifts.