NVIDIA’s Q2 FY27 earnings released this week significantly exceeded market expectations—does this imply that global AI computing demand will continue expanding over the next three years?

Data source: East Money financial data interface; companies’ Q1 and semi-annual reports for 2026. Percentages are calculated herein. Across the entire industry, 18 companies with comparable year-on-year data collectively posted a gross profit increase of RMB 12.028 billion. Zhongji Xunshuang alone accounted for 54.3%, and New Optics for 17.7%—together representing 72%. The remaining 16 companies shared just 28%. This concentration implies: the statement “AI computing demand is expanding” currently holds true only for a very small number of companies. Most optical module firms have seen only modest improvements in profitability. III. Evidence and Questions Regarding Three-Year Continuous Expansion Confirmed observations: • Structural shortages in memory are widening. According to TrendForce’s research dated 2026-07-30, the DRAM supply-demand sufficiency ratio for 2026 stands at −1% to −2%, with the gap projected to widen further in 2027. HBM bit shipments are growing 50–60% year-on-year—but still fall short of demand. • Gross margins of leading optical module companies have risen for five consecutive reporting periods. Zhongji Xunshuang’s gross margin climbed from 33.80% to 46.06% across five periods—ruling out short-term inventory gains as an explanation. Similarly, Yangtze Optical Fiber & Cable’s margin rose from 27.30% to 41.51% over the same span. • Buyers remain actively investing. TrendForce data shows that capital expenditures by the top nine CSPs increased ~90% year-on-year, while server shipments rose 17% annually. Uncertainties: • Buyers have begun redesigning products to cope with high prices. NVIDIA revised its HBM configuration for the Rubin Ultra platform—from originally planned HBM4e 12hi to parallel evaluation of lower-spec alternatives. CSPs are also reducing RDIMM and SOCAMM capacities. When price hikes compel buyers to alter product definitions, that price level enters a self-limiting phase. • Gross margin improvement among A-share optical module companies may have peaked. Tianfu Communications’ gross margin stood at 56.60% in Q1 2026—still below its 57.22% in Q4 2024. Back-calculations indicate a single-quarter gross margin of 60.56% in Q4 2025, dropping to 56.60% in Q1 2026—a sequential decline of 3.95 percentage points. • Profit quality has diverged across the semiconductor equipment sector. Among 14 A-share equipment firms, the gap between net income attributable to shareholders and non-recurring net income ranges from 0.5% to 315.7%. For example, Top Metro reported a 488.3% YoY increase in net income attributable to shareholders—but its fair value gains surged from RMB 0.127 billion to RMB 4.484 billion, contributing RMB 4.357 billion alone. In some cases, profits stem not from equipment sales but from non-operational sources. My assessment: AI computing demand will most likely continue expanding over the next three years—but the word “expansion” must be interpreted correctly: the overall demand pie is growing, yet the distribution of slices is undergoing dramatic shifts. The blanket, across-the-board upturn observed from 2025 through mid-2026 will not persist into 2028. Data boundary note: SK Hynix financial data comes from its official Newsroom release (2026-07-29) and represents unaudited preliminary figures.

Ingenic Electric: Q1 order backlog exceeds RMB 2 billion, potentially initiating a new growth cycle.

According to operational data, the company generated RMB 634 million in revenue from the photovoltaic (PV) sector in 2025, RMB 329 million from the semiconductor and electronic materials sector, and RMB 537 million from other sectors. Amid complex industry conditions, the company maintained strong competitiveness across all core business segments. Notably, the company’s power supply products feature rich diversity and broad application coverage—conferring a distinct advantage in product structure. While downstream PV customers generally faced significant operational pressure in 2025, Ingenic Electric sustained stable operations through diversified businesses—including semiconductor power supplies, controllable nuclear fusion power supplies, and medical power supplies. Regarding the semiconductor and electronic materials sector, Ingenic Electric continued ramping up R&D investment in semiconductor equipment power supplies during the reporting period. It achieved new technological breakthroughs in both semiconductor process power supplies and semiconductor material manufacturing power supplies, further increasing the number of mass-produced models. Several newly developed models are currently undergoing optimization and testing. Meanwhile, the company is planning to expand production capacity for related products to proactively secure future output readiness. Its semiconductor power supply business has now entered a rapid growth phase. In other business segments, the company actively expanded into diversified applications during the reporting period. Power supply businesses serving steel metallurgy, industrial furnaces, and the medical sector posted particularly robust growth—becoming key pillars supporting the company’s overall expansion and laying a solid foundation for future development. Industry insiders observe that, after more than three decades of technical accumulation, Ingenic Electric has built an industrial and specialty power supply technology platform covering the full range of power ratings. This enables cross-sectoral technology reuse and breakthroughs in multiple core areas previously dominated by overseas players—making it a pivotal force in China’s domestic substitution efforts. Looking ahead, the company is well positioned to sustain high-quality growth by leveraging its platform-based technological advantages and multi-business synergy, thereby reinforcing its resilience against cyclical volatility. Q1 order backlog surges; total order backlog exceeds RMB 2 billion The company achieved steady overall development in 2025. Within the “other sectors” segment—which includes high-end steel metallurgy, industrial furnaces, glass/fiberglass, healthcare, and research institutes—the company secured approximately RMB 733 million in new orders, reflecting especially strong momentum with a year-on-year growth rate exceeding 40%. This robust trend carried into Q1 2026, further highlighting the company’s multi-driver business model. Per its latest Q1 report, the company recorded RMB 302 million in revenue and RMB 36.3348 million in net income attributable to shareholders in Q1 2026. In its most recent investor briefing, the company noted that its semiconductor-related business—drawing heightened market attention—performed exceptionally well, generating sales of approximately RMB 99 million, up 31% year-on-year.

Ingevity reports second quarter 2026 financial results

Jul 30, 2026

Ingevity Corp reported strong Q2 2026 financial results with $314.1 million in sales, raising full-year guidance. The company plans to reduce leverage and focus on carbon technologies following the Road Markings divestiture.

Yahoo Finance

2026-07-02

Ingevity announces Q2 2026 earnings release and webcast

2026-07-03

Ingevity Announces Dates for Second Quarter 2026 Earnings Release and Webcast

2026-07-08

Ingevity Corp Files Form 4 Disclosure on July 8

2026-07-29

Ingevity Corp Files Form 4 on July 29

2026-07-29

Ingevity Earnings Up Next as Specialty Chemicals Maker Eyes Rebound