Highlights

• FIT’s 3Q26 revenue grew 4.0% yoy to US$1,378m but operating profit declined 38.8% yoy to US$58m, impacted by higher material costs and slower-than-expected facility ramp-up. 9M26 revenue and net profit represented 69% and 32% of our full-year estimates respectively.
   

• Management guided down consumer interconnect revenue to a mid-20s percentage decline and cut its 2026 operating profit guidance from 70% yoy growth to flattish growth due to continued margin pressure and production ramp-up. It targets 2027 operating profit to grow faster than revenue, with official guidance to be announced in Mar 27.
   

• Maintain BUY but lower our target price from HK$9.19 to HK$4.20, based on a lower 2027F PE of 15.0x and lower earnings estimates. FIT trades at 10.4x 2027F PE, vs its 2021–26 historical mean of 15.1x.
   

  

Analysis

• 3Q26 results. FIT Hon Teng’s (FIT) 3Q26 revenue grew 4.0% yoy to US$1,378m, bringing 9M26 revenue to US$3,873m, or 68.5% of our full-year revenue estimate. Gross profit fell 14.3% yoy to US$267m in 3Q26, with gross margin narrowing 4.1ppt yoy to 19.4%. 3Q26 operating profit declined 38.8% yoy to US$58m, impacted by higher material costs, slower-than-expected facility ramp-up (particularly in Vietnam) and lower-than-expected cloud revenue. Stripping out the negative forex impact, 9M26 operating profit would have grown approximately 31% yoy.