PAX Global Technology (0327) H1 2026 earnings summary

Executive summary

• Revenue rose 15.4% year-over-year to HK$3,135.7 million, with all regions contributing to growth, especially North America and Latin America, driven by strong Android solution demand and disciplined cost control.

• Profit attributable to owners increased 32.6% year-over-year to HK$518.2 million, supported by robust Android terminal sales and cost management.

• Gross profit margin declined to 44.5% from 46.9% due to higher raw material costs and RMB appreciation.

• Android solutions accounted for 75% of revenue, up from 69% year-over-year, with flagship models scaling globally and commercial EPOS showing double-digit growth in the U.S.

• Interim dividend per share was HK$0.08, down from HK$0.25 in the prior year period, with a payout ratio of 16.4%.

Financial highlights

• Operating profit increased 26.4% year-over-year to HK$595.6 million.

• Earnings per share (basic) rose 32.2% to HK$0.488; diluted EPS up 33.6% to HK$0.485.

• Net current assets grew 11.9% to HK$7,429.5 million as of 30 June 2026.

• Net cash used in operating activities was HK$80.5 million, mainly due to higher inventory procurement.

• No borrowings or significant investments as of 30 June 2026.

Outlook and guidance

• Management expects continued cost pressures from memory chip price increases due to global AI demand, with higher-cost inventory impacting gross margin.

• Proactive mitigation measures include focusing on core markets, optimizing product mix, disciplined procurement, and expanding the SaaS ecosystem.

• Strategic focus remains on North America, Europe, and Japan, with further investment in Asia Pacific and Latin America.