Hua Hong Grace profit jumps 147.1% on record quarterly revenue

By Nathan Brooks

Hua Hong Grace Semiconductor reported third-quarter net profit attributable to shareholders of the parent company of $123.4 million. Profit climbed 147.1% from $50 million a year earlier.

Revenue reached a record $987.1 million, rising 19.9% year on year and 9.9% from the second quarter. Gross margin reached 24.6%, up 7.6 percentage points from a year earlier and 4.7 points from the second quarter.

Hua Hong Grace filed the unaudited results with the Hong Kong Stock Exchange on Nov. 5 for the quarter ended Sept. 30, 2026.

What changes for chip buyers after the Huali deal?

Reported results include Shanghai Huali Microelectronics, which Hua Hong Grace completed acquiring during the quarter. Excluding Huali Micro, revenue was $803.4 million, above the company’s earlier guidance of $770 million to $780 million.

Gross margin excluding the acquired business was 19.9%, above the guided range of 16% to 18%. For chip buyers, the practical change is that Huali’s revenue and margin now affect the headline numbers, while the exclusion figures isolate the rest of Hua Hong Grace’s business.

Hua Hong Grace’s disclosure makes that distinction explicit because the acquisition complicates period-to-period comparisons. Practitioners tracking the foundry should monitor both the consolidated figures and the $803.4 million revenue base excluding Huali Micro.

Demand broadens across several product lines

Hua Hong Grace said demand improved across several specialty semiconductor products. China, including mainland China and Hong Kong, generated $760.8 million of revenue, or 77.1% of the total.

Revenue from that China market rose 14.6% as demand increased for microcontrollers, flash memory, smart-card chips, logic products and general-purpose MOSFETs. Weaker analog demand partly offset those gains.

Revenue from other Asian markets was roughly unchanged at $76.9 million.

Across product categories, Hua Hong Grace reported:

• Embedded non-volatile memory revenue increased 42.5% to $252.5 million.
• Standalone non-volatile memory revenue grew 28.2% to $147.6 million.
• Power discrete revenue climbed 19.5% to $202 million.
• Analog and power-management revenue rose 13.5% to $199.9 million.

Those gains came as Hua Hong Grace shipped 1.91 million eight-inch-equivalent wafers, an 11.5% increase from a year earlier. Capacity utilization was 102.9%, compared with 108.7% in the same period of 2025.

The company therefore paired higher shipment volume with a lower reported utilization rate than a year earlier. Revenue also grew faster than shipment volume, reflecting the company’s shift toward higher-value 12-inch production.

Hua Hong Grace said artificial intelligence-related products continued to support global semiconductor demand. It also said industrial and automotive markets were gradually improving.

The company cited tighter supply in some microcontroller, flash, power-management and power-discrete segments. These demand and supply assessments are company commentary rather than independent market findings.

The revenue mix shifts toward 12-inch wafers

Twelve-inch wafers accounted for 70.7% of quarterly revenue, up from 68.6% a year earlier. Hua Hong Grace operates fabrication facilities in Shanghai and Wuxi and said construction of its Wuxi III 12-inch production line was underway.

TNGlobal previously reported that the expansion sits within China’s broader effort to strengthen its domestic semiconductor supply chain. For customers tracking capacity, the growing 12-inch contribution makes the Wuxi III project the company’s clearest visible expansion point.

Fourth-quarter guidance points higher

For the fourth quarter, Hua Hong Grace expects revenue of approximately $1.08 billion to $1.09 billion and a gross margin of 25% to 26%. On the company’s guidance, both metrics would exceed the third quarter’s $987.1 million revenue and 24.6% gross margin.

Hua Hong Grace enters the final quarter with record revenue, above-guidance performance excluding Huali Micro and tighter supply across several product categories. The forward test is whether AI-related demand, improving industrial and automotive markets and the Wuxi III build sustain the higher guidance. The acquired Huali business and new 12-inch capacity will determine whether the third quarter’s profit surge becomes a steadier earnings trend.