Company Coverage
Lens Technology (6613 HK): 3Q26: Core Business Weakness And Emerging-Business Investment Pressure Earnings
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$16.39
HK$21.50
+31.2%
HK$43.10
Analyst
Analyst
Highlights
- Lens Tech’s 3Q26 results came in below expectations, primarily due to: a) a below-seasonal delivery to its large client as orders were pushed into 4Q; and b) a meaningful forex loss and elevated operating expenses.
- Earnings growth should improve meaningfully in 4Q26-1Q27, due to the aforementioned delayed delivery to the large client, stronger orders, and contribution from new initiatives.
- Maintain BUY but slash target prices of of Lens-A to Rmb32.10 and Lens-H to HK$21.50.
Analysis
- Revenue and gross margin shortfalls drove earnings miss. Revenue declined 8.1% yoy due to weaker mid-range smartphone and PC demand, a delayed launch of its major client’s new products, and renminbi appreciation, but rose 29.3% qoq on seasonality to Rmb19,035m, 13.0% below consensus estimates. Gross margin contracted 2.3ppt yoy and 1.4ppt qoq to 16.8%, 2.7ppt below consensus. Operating profit fell 45.8% yoy to Rmb1,183m, 56.0% below consensus, reflecting the gross margin shortfall and higher R&D spending on new businesses and products. As a result, reported net profit fell 50.4% yoy to Rmb843m, 65.8% below consensus, further weighed down by a forex loss of over Rmb100m.
Highlights
- Lens Tech’s 3Q26 results came in below expectations, primarily due to: a) a below-seasonal delivery to its large client as orders were pushed into 4Q; and b) a meaningful forex loss and elevated operating expenses.
- Earnings growth should improve meaningfully in 4Q26-1Q27, due to the aforementioned delayed delivery to the large client, stronger orders, and contribution from new initiatives.
- Maintain BUY but slash target prices of of Lens-A to Rmb32.10 and Lens-H to HK$21.50.
Analysis
- Revenue and gross margin shortfalls drove earnings miss. Revenue declined 8.1% yoy due to weaker mid-range smartphone and PC demand, a delayed launch of its major client’s new products, and renminbi appreciation, but rose 29.3% qoq on seasonality to Rmb19,035m, 13.0% below consensus estimates. Gross margin contracted 2.3ppt yoy and 1.4ppt qoq to 16.8%, 2.7ppt below consensus. Operating profit fell 45.8% yoy to Rmb1,183m, 56.0% below consensus, reflecting the gross margin shortfall and higher R&D spending on new businesses and products. As a result, reported net profit fell 50.4% yoy to Rmb843m, 65.8% below consensus, further weighed down by a forex loss of over Rmb100m.
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$16.39
HK$21.50
+31.2%
HK$43.10
Analyst
Analyst
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
Related articles
14 Oct 2026
Lenovo Group (992 HK): PC Shipments Miss Expectations In 3Q26
12 Oct 2026
Xiaomi Corp (1810 HK): SKYNOAD’s Locked Orders Surpass 70,000 Units
29 Sept 2026
Sunny Optical (2382 HK): NDR Takeaways: 2026 Guidance Reiterated With Pan-IoT And AR Glasses Driving Growth
Our latest research
26 Oct 2026
Xtep International Holdings(1368 HK): Core Xtep Brand’s Offline Sell-Through Remains Under Pressure; Reiterates Full-year Targets
23 Oct 2026
TA: Lenovo Group (0992 HK) / WuXi Biologics (2269 HK)
23 Oct 2026