On the evening of April 11, Lixin Micro (688601) disclosed its 2024 annual report, during the reporting period, the company achieved revenue of 787 million yuan, a year-on-year decrease of 11.19%; the net profit attributable to the parent company was 126 million yuan, a year-on-year decrease of 37.23%; deducted non-net profit of 105 million yuan, a year-on-year decrease of 40.88%; Basic earnings per share was 0.94 yuan. The company intends to distribute a cash dividend of 4 yuan (tax included) to all shareholders for every 10 shares.

Regarding the decline in performance, Lixin Micro mentioned that during the reporting period, the operating income decreased year-on-year due to the intensification of industry competition and the difference in the pace of demand recovery in various fields of the downstream market.

In order to continue to strengthen the construction of medium and long-term core competitiveness, enrich the company's product series to cover more downstream application fields, the company's R&D expenditure investment this year has increased compared with the previous year, and in view of the company's consumer electronics industry has the characteristics of rapid technology iteration and short product life cycle, based on the principle of prudence, the inventory impairment test and provision for price decline have been made, and the asset impairment loss in the reporting period has increased more than the same period last year.

In addition, the company's net cash flow from operating activities decreased by 37.75% year-on-year, mainly due to the decrease in sales scale, the cash received from the corresponding sales of goods also decreased, the second is the decrease in government subsidies received compared with the previous year, and the third is to increase the company's team building and increase the salary expenses paid for employees.

According to the data, Lixin Micro focuses on the R&D and sales of analog chips. By providing high-performance and high-reliability power management chips, we create excellent power management solutions for customers. At the same time, the company is also expanding and improving its product line in other categories such as signal chain chips and high-precision Hall chips to meet the diversified needs of the market.

It should be noted that during the reporting period, the sales share of the top five customers of Lixin Micro reached 66.04%.

Lixin Micro reminded that although the company has established a solid cooperative relationship with customers, if major customers face major operating difficulties in the future, the procurement demand is significantly reduced or the procurement strategy is changed, it may lead to a sharp decrease in the company's order volume, which will have a negative impact on the company's operating performance. In addition, if the company fails to launch new products in a timely manner according to market demand, or fails to obtain certification for multiple new products in a row, this may damage the foundation of cooperation or cause customer loss, which may have a negative impact on the company's operating results.

In terms of products, in 2024, the sales revenue of the company's power protection chip products will decrease by 15.20% year-on-year, the cost of sales will decrease by 17.72% year-on-year, and the gross profit margin will increase by 1.69 percentage points year-on-year.

The sales revenue of power conversion chip products decreased by 15.04% year-on-year, the cost of sales decreased by 14.14% year-on-year, and the gross profit margin decreased by 0.59 percentage points year-on-year.

The sales revenue of signal chain chip products decreased by 13.79% year-on-year, the cost of sales decreased by 27.46% year-on-year, and the gross profit margin increased by 7.46 percentage points year-on-year.

The sales revenue of other products decreased by 18.70%, the cost of sales decreased by 19.47% year-on-year, and the gross profit margin increased by 0.56 percentage points year-on-year.

Lixin Micro said that during the reporting period, due to the intensification of industry competition and the difference in the pace of demand recovery in various fields of the downstream market, the operating income decreased year-on-year. Affected by the market supply and demand, the competition between wafer foundries and material suppliers intensified, and the purchase price of some wafers and the price of product packaging decreased, resulting in a decrease in the unit cost of some products and an increase in gross profit margin.

In addition, in 2024, the company's direct sales revenue decreased year-on-year, mainly due to the intensification of industry competition and the difference in the pace of demand recovery in various fields of the downstream market, and the operating income decreased year-on-year.

Looking at the production and sales situation, during the reporting period, the output of the company's main product power protection chips was 589,427,800, the production and sales rate was 97.48%, and the sales volume decreased by 22.18% compared with the previous year; The output of power conversion chips was 2026,920,700, with a production and sales rate of 98.53%, and a sales volume of 8.23% lower than that of the previous year; The output of display driver chips was 115,628,400, the production and sales rate was 102.79%, and the sales volume increased by 25.46% over the previous year; The output of intelligent networking delay management units was 31,777,900, the production and sales rate was 108.24%, and the sales volume was 10.98% lower than that of the previous year; The output of signal chain chips was 129,391,900, with a production and sales rate of 99.23%, and a sales volume of 6.86% lower than that of the previous year; The output of other types of chips was 71.4682 million, with a production and sales rate of 87.41%, and a sales volume increase of 14.95% over the previous year.

Lixin Micro mentioned that due to the decline in the overall sales scale and the decrease in sales volume during the reporting period, in order to ensure the rationality of the inventory, the production volume of some products was reduced accordingly; The display driver chips in the main products have been successfully introduced into new products and account for a relatively high proportion, sales have risen, and production has increased simultaneously, due to the inventory in the previous period, the current period has not been put into production in large quantities, resulting in a year-on-year decrease in inventory; Other types of products in the main products, due to product structural adjustment, the proportion of products with low unit prices is relatively high, although the sales revenue has declined, but the output and sales have increased, and the inventory has also increased compared with the previous year.

In terms of expenses, in 2024, the company's sales expenses will increase by 16.07% year-on-year, mainly due to the salary increase in the current period, and the increase in travel expenses, advertising expenses, sample costs, etc. in order to develop the market.

Administrative expenses increased by 11.51% year-on-year, mainly due to the large increase in management salaries, intermediary service fees, and office expenses during the reporting period.

R&D expenses increased by 30.63% year-on-year, mainly due to the expansion of R&D personnel and the increase in R&D personnel's salary.

The fundamentals of Lixin Micro have weakened, with a year-on-year growth rate of -37.23% in net profit attributable to the parent company, a decline of 61.78% in the industry, and a decline in competitiveness. The growth rate of main business income was -11.27%, ranking at the bottom of the industry 5.88%, and the competitiveness was weak; The ranking in the industry fell by 73.83%, and the competitiveness declined.

The latest share price of Lixin Micro is 38.50 yuan per share, with a total market value of 5.147 billion yuan. In the past three years, the stock price has fallen by more than 40%.